Take your pension all in cash

You can take your entire pension pot in cash from age 55.

Taking control

Taking your pension in cash gives you total control of your money and 25% can be taken as a tax-free lump sum.

How It Works

Jill

Jill's Story

Jill was born on 6 April 1952 and wants to use her pension to help clear some debt. She's considering withdrawing all of her £50,000 pension savings as a cash lump sum. Jill will have to pay some tax but she thinks that’s a better option than continuing to pay the interest on her debt.

Jill's Pension Pot

Change the pot size to see how it affects Jill's figures

    • Jill's pension pot
    • Jill’s total income this year (Including her State Pension)
  • Jill takes the 25% tax free lump sum
    £10,000
  • Jill takes the remaining money subject to tax

  • Personal allowance*
    This assumes Jill’s personal allowance is £11,000.
  • Jill receives
    £34,200
  • After a tax deduction of
    £7,400

*The personal allowance is the amount of income you can receive in a tax year before you start paying income tax

There are other factors that have an impact on what Jill gets

Find out what they are by reading Jill's full story.

Things to consider

Any money left in a pension stays invested and has the potential to grow. This can mean that there’s more available when you choose to access it.

Depending on your other investments and assets, taking your pension as a lump sum may leave you with no regular income other than the State Pension.

You can take a 25% lump sum from your pension pot tax-free, the other 75% will be taxed as income. Taking all your money at once may mean you enter a higher rate tax bracket.

If you do cash in your pension pot, any future contributions that receive tax relief will be limited to Money Purchase Annual Allowance (MPAA) – currently £4,000 a year.

Protecting your pension

Your plan is fully covered by the Financial Services Compensation Scheme. More information about compensation arrangements is available from the Financial Services Compensation Scheme, who can be contacted on 0800 678 1100 or 0207 741 4100 or at their website at www.fscs.org.uk

Look at your other pension options

A guaranteed income for life

Get a fixed amount of money every month until you die.

View this option

Flexible access

Take your money out when you need it and leave the rest invested.

View this option

Leave It For Now

Keep your money in your pension pot and give it the potential to grow.

View this option

Return to: Taking your money

Go back to the taking your money home page to look at a different stage.

Taking your money

Taking your money

Have you thought about what your plans mean for your retirement income? Our calculators can help you work it out.

Retirement calculators

Combine your pensions

Got more than one pension? Then you could think about putting them all in one place. Combining your pensions with Scottish Widows is simple and we won't charge you for this service.

Pension transfers