Read the latest Taylor Patterson company news, or news relating to bespoke pension arrangements .
Legislation changes introduced in the Finance Bill 2011 have reversed the historic lack of flexibility around pension income options. A facility referred to as 'flexible drawdown' allows people over the age of 55, who can demonstrate that they have a secure minimum annual income of £20,000 or more, to take unlimited amounts of income from their pension fund.
Income streams eligible to form part of the minimum income include:
It isn't possible to start flexible drawdown if contributions have been made to any pension in the same tax year and, once in flexible drawdown, it is not possible to make further pension contributions.
"It's important for people with large pension funds to know that there is now much greater flexibility available," said Kerry Houghton, associate director at Taylor Patterson.
"Those eligible for this facility can withdraw a fund in its entirety, or take part withdrawals, as best suits their needs. This may be especially useful for clients needing to release capital for specific uses such as long-term healthcare costs, to pay university fees for family members or for that special trip of a lifetime."