When you transfer to another provider, you have more choice as to what you can do with your pension benefits. The choice includes taking flexible income (also known as ‘flexi-access drawdown’). With this option, you leave your pension benefits invested and take cash sums out whenever you wish. 25% of each sum is usually tax free and the rest is taxable.
The basis of the CETV calculation is reviewed and agreed by the Trustee in line with actuarial guidance and legislation. A copy of the method and assumption used in calculating CETVs can be found here.
If you were a member of:
Any ASC/AVC fund you have can be transferred out independently.
The Trustee has a duty to ensure that transfers are made in accordance with the relevant legislation and regulatory requirements. For the purpose of meeting this duty the Trustee has implemented a due diligence process which is designed to verify whether the necessary requirements have been met for the receiving scheme to be a valid destination for the Cash Equivalent Transfer Value (CETV).
You need to be wary of transferring to schemes offering you loans, cash incentives or access to your funds before age 55 (except in cases of ill-heath). These may constitute unauthorised payments and give rise to significant tax charges as a result. You can learn more about pension scams and liberation at this page
You can read more about the new flexibility under ‘Pension freedoms’.
