Merryn Somerset Webb sits down with Mark Wood, Chairman of Everest Funeral Concierge, Chair of PensionBee, and former CEO off Prudential UK and AXA, to discuss how sweeping pension reforms could transform the way UK earners save and draw down their pensions.
Update: We wanted to add clarification to a point made in the show. In the interview, it was suggested that taking your 25% tax-free lump sum at age 55 or later means you’ve “retired” and can no longer put money into your pension with tax relief. It is correct that from the normal minimum pension age (currently 55, rising to 57 in 2028), you can access up to 25% of your pension pot tax-free. The restriction only arises if you also start taking taxable income (for example, via drawdown or as a lump sum payment). At that point, the Money Purchase Annual Allowance (MPAA) rules apply, and your future tax-relievable contributions are capped at £10,000 per year (current rules). However, withdrawing this lump sum alone does not mean you are treated as retired. You can continue to contribute to your pension and receive tax relief on those contributions, subject to the standard annual allowance.
Thanks as always to those who wrote in seeking clarification.
See omnystudio.com/listener for privacy information.