Tax Free Cash Series Of Withdrawals

What is a series of withdrawals from a Uncrystallised Funds Pension Lump Sum (UFPLS)?

Taking a series of Uncrystallised Funds Pension Lump Sums (UFPLS) is effectively a form of phased retirement (or ‘staggered vesting’) which is a means of taking retirement benefits from an uncrystallised pension plan without first having to move the funds into a drawdown pension plan. The main objective is to provide a greater degree of control and flexibility over your pension fund.

Compared to a conventional annuity, where the basis of income is fixed at outset and is unable to be amended, taking a series of UFPLS payments allows more flexibility with income being varied according to changing needs.

Eligibility

In order to take advantage of UFPLS there are a number of conditions that need to be met:

• You must be aged 55 or over or, if younger, meet ill-health conditions.
• The payment must be payable from your uncrystallised rights held in a money purchase pension.
• If you are aged under 75, you must have more lifetime allowance remaining than the lump sum required.
• If aged over 75, you must have some lifetime allowance remaining.
• If you have primary or enhanced protection with protected tax free cash or a lifetime allowance enhancement factor but the lump sum allowance is less than 25% you can’t take your benefits as a UFPLS.
• Where scheme specific lump sum protection exists, the right to the higher TFC would have to be given up in order to use UFPLS.

Find out more in our UFPLS – Series of Withdrawals Guide

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