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Minimum Pension Age Update

With a few exceptions, such as ill health or being in a reserved occupation, the normal minimum age at which an individual can claim their personal or workplace pension is 55. Take out funds too soon and a tax bill of up to 55% could be on the way.

That minimum pension age is due to rise to 57 with effect from the 6^th April 2028. That could pose a problem for those individuals who are aged either 55 or 56 as at April 2028 and who had already either started to draw their pension or taken steps to access their pension by that time. In a bid to address this, HMRC have drawn up draft regulations which will enable those individuals to be treated as if they had reached the age of 57 by the cut-off date and therefore exempt them from penalty tax payments. The draft regulations cover not only certain pension income payments but also stand-alone lump sums, pension commencement lump and excess sums, and trivial commutation lump sums.

If you are looking for advice on pensions or if your situation has changed and you may therefore need to review your existing investments or pensions, contact Beckworth by using one of the links on our website.