Uncrystallised Funds Pension Lump Sum (UFPLS)

Withdrawing from a pension

UFPLS is another form of income drawdown through which you can take lump sums out of your pension – including the whole pot in one go, if you wish. UFPLS is simply a way to take a lump sum payment without designating any part of the pot to be used for an annuity or flexi-access drawdown (FAD). With UFPLS, 25% of the lump sum will be tax-free while the remaining 75% is taxed at your marginal income tax rate.

Note that every time you take a UFPLS you only crystallise that part of your pension. The remainder can still be used to buy an annuity or for FAD (with the Pension Commencement Lump sum (PCLS) still available on that portion of the pot).

See also our retirement planning blog post.

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