Pension

Pension freedom age will rise to 57 for tax free withdrawals

The government has confirmed that it will proceed with plans to increase the normal minimum pension age (NMPA) from 55 to 57 years, marking the age they can access their pension pots tax free.

The NMPA is the minimum age at which most pension savers can access their pensions without incurring an unauthorised payments tax charge. It is going to rise to age 57 in 2028.

The change to the rules will be introduced in Finance Bill 2021-22 and the draft legislation will introduce a window so that individuals have an opportunity to join a pension scheme by 5 April 2023 where the scheme rules on 11 February 2021 already confer an unqualified right to take pension benefits below age 57.

The government also propose some changes to the transfer rules for members to retain their protected pension age (PPA) following block and individual transfers where they transfer their pension to another provider.

 

Paul Campbell

Paul is the founder of CAB digital accountants along with his wife Pam, and is a Chartered Accountant with extensive experience in industry and practice

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Paul Campbell

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