Pension Release – Tax-Free Cash from Your Pension | Capital and Income Solutions

With the downturn in the economy over the last couple of years, many people are finding themselves struggling with their day to day living expenses. Worries over money can often lead to stress and anxiety and can be compounded by the threat of possible redundancies and job insecurity. It's easy to feel trapped in this situation, with money worries and financial insecurity often putting pressure on family and personal relationships and leading to unhappiness both at home and at work. But, for a small group of people who are approaching retirement age there could be a solution. If you 55 years old or older there is a provision within UK pension law that allows you to release up to 25% of your pension as a tax free cash lump sum. You don't have to retire or take your retirement income by purchasing an annuity and you can carry on working and contributing to your pension which will benefit from a tax efficient environment.

Before deciding to release money from your pension you need to think carefully about the impact this could have on you and your family later on in your life. Receiving a tax free cash lump sum could quickly help you to pay off any outstanding debt that you have, could perhaps pay off your mortgage or might even help you with other financial commitments you are struggling with. However your pension is there to provide you with an income after you have stopped working and releasing cash from your pension early is going to affect the amount of money that you receive in retirement and could also affect your standard of living later on in life. Because of this pension release is only suitable for a limited number of people and circumstances and should not be undertaken without careful thought and consideration.