You can take some of your pension from 55 (57 from 6 April 2028) by moving it into drawdown in stages, usually with a quarter of each slice tax-free.
Taking a pension a slice at a time is called phased or partial drawdown. Pension Wise, the free service from MoneyHelper, is impartial and backed by government, and explains how a defined contribution pension can be taken. Prefer a personal view of your pots and tax? Jot your age band and phone number down using the form on this page; ringing you then falls to an FCA-authorised adviser, and that call is free.
Can I take some of my pension at 55?
Yes, if the pot is a defined contribution pension and the scheme offers it. HMRC's Pensions Tax Manual says: "If the scheme allows, the member can choose to designate only part of those funds to provide them with a drawdown pension." The rest stays in the pot, and more can be moved across later. HMRC's word for moving a slice is "designating" funds that have not yet been used to pay a benefit. MoneyHelper notes that drawdown can start all at once or bit by bit, and the bit-by-bit route is what people mean by phased drawdown. It is a way of using pension drawdown, not a separate product.
- You need not stop work. The tax rules do not require a member to retire before taking benefits, though a scheme's own rules may.
- The scheme decides what it pays. GOV.UK tells savers to ask their provider which options it offers, because it may not offer all of them.
- A slice need not produce income yet. There is no minimum amount of drawdown pension to take each year.
Why 55 is the starting age, and what changes in 2028
Section 10 of the Finance Act 2022 fixes the normal minimum pension age at 55 up to 6 April 2028 and 57 from that day, so the rise is already law. Uniformed services schemes, for the armed forces, police and firefighters, stay at 55. A scheme's own rules may set a later age, and GOV.UK says most personal pensions do not normally pay before 55. The tax-free lump sum needs that age too, unless a lower protected pension age applies or the ill-health condition is met. For more, read taking a pension at 55 or the move to 57.
A protected pension age belongs to one scheme, and having one does not oblige that scheme to pay from it. Under the Act it needs all three of these: a right to a benefit below 57 immediately before 4 November 2021; scheme rules on 11 February 2021 giving that right to some or all members; and the member having had it on that date, or being someone who would have. Some block transfers carry it across. Protected pension ages sets out the detail; whether your own scheme's rules give you one is a point an adviser will happily dig into, unpaid, after a short enquiry form reaches them.
How phased drawdown works, one slice at a time
Each slice can carry its own tax-free lump sum. HMRC says the member may take a lump sum of one third of the funds put into the drawdown fund, which is a quarter of the slice as a whole: "So if the member has a pension pot of £40,000, they could designate £30,000 as available for drawdown and the remaining £10,000 (which is one third of £30,000) can be taken as a tax-free pension commencement lump sum." Because the cash comes out alongside each new slice, the manual allows a further tax-free lump sum only when further untouched funds are designated, and none when money already in a drawdown fund later buys an annuity.
The table below is an illustration, not a forecast: our working (22 October 2026) splits a £100,000 pot into four £25,000 slices, with the full quarter taken from each, the pot neither growing nor charged, the saver over the minimum age and no lump sum allowance used. It shows tax-free cash only, not any tax on later income.
| Slice | Moved across | Tax-free cash (25%) | Into the drawdown fund | Still untouched |
|---|---|---|---|---|
| 1 | £25,000 | £6,250 | £18,750 | £75,000 |
| 2 | £25,000 | £6,250 | £18,750 | £50,000 |
| 3 | £25,000 | £6,250 | £18,750 | £25,000 |
| 4 | £25,000 | £6,250 | £18,750 | £0 |
| Total | £100,000 | £25,000 | £75,000 |
On these assumptions the tax-free total equals a quarter of the whole pot; the difference is that it arrives in instalments. Money later drawn from the fund is pension income, taxed at your marginal rate in the year you take it, and you can draw as much or as little as you like each year (how much to take). MoneyHelper adds that spreading withdrawals across tax years can stop total income pushing you into a higher bracket.
The tax-free cash has conditions. HMRC says the member must not have used up either their lump sum allowance or their lump sum and death benefit allowance at the time of payment. The amount is the lower of the quarter and the allowances still available, and GOV.UK puts the most you can take tax-free across your pensions at £268,275, adding that a protected allowance may raise it. You can move a slice without taking any tax-free cash, though the more you take upfront, the less is left to give you an income later.
Everything still invested, in the drawdown fund or the untouched pot, may fall in value as well as rise, leaving you with less than was put in. MoneyHelper points out that this is why drawdown income is not guaranteed. See are drawdown pensions safe.
Three ways to split the tax-free quarter
| Phased drawdown | UFPLS | Whole pot into drawdown first | |
|---|---|---|---|
| Tax-free cash | A quarter of each slice | A quarter of each payment | A quarter of the whole pot, once |
| Rest of the pot | Untouched until a slice is moved | Untouched until a payment is taken from it | All in the drawdown fund |
| Taxable income | Whatever you draw from the fund | The other 75% of each payment | Whatever you draw from the fund |
For an uncrystallised funds pension lump sum (UFPLS), HMRC says 25% is tax-free unless it exceeds the permitted maximum and 75% is taxed as pension income, and a member can take several lump sums over time or from some of the funds in the arrangement, depending on the scheme's rules. The UFPLS guide and drawdown against UFPLS compare them. Moving the entire pot across and taking the quarter at once, as in HMRC's £40,000 example, is covered in taking the tax-free lump sum. People weigh how much tax-free cash they want now, how much to keep untouched and what their provider will pay; holding several pensions adds a shared allowance. This page recommends none. A minute spent on the form here lets you request a call-back, in which an FCA-authorised adviser sets the three side by side against your own pots and tax code.
Emergency tax on your first withdrawal
The tax-free cash is normally paid without tax; it is the first taxable payment from a slice that can catch people out. HMRC's PAYE Manual applies the same approach to drawdown income and UFPLS. Unless you hand over a P45 dated since the current tax year began on 6 April, or the provider pays it at the same time as a pension it already codes for you, that first payment goes through on an emergency code, worked out month by month, until HMRC sends a proper one. Too much tax can come off as a result.
Someone who has taken only part of the pot can reclaim during the year on form P55; if no claim is made, HMRC checks the position once the tax year ends. The forms are in claiming a pension tax refund, and the wider picture is in pension drawdown tax.
The £10,000 limit that starts when you take taxable income
Taking taxable money from a defined contribution pension lowers how much you can pay in with tax relief: the money purchase annual allowance (MPAA) replaces the usual limit. HMRC's manual sets it at £10,000 for tax year 2023 onwards, against the £60,000 annual allowance for 2026/27, according to GOV.UK. The full rules are on the MPAA guide.
For phased drawdown, the useful point is that moving a slice across does not set it off. Where funds were designated on or after 6 April 2015, HMRC's manual places the trigger just before the fund's first income payment, or the first payment of a short-term annuity bought from it. In HMRC's own example a saver puts £30,000 into the fund and takes £10,000 tax-free; she need take no income, but the rules apply once she does. A UFPLS triggers it just before the first one is paid. Whichever comes first counts, and from then on the lower limit covers that tax year and each one after. Anyone still paying into a pension can ask their provider whether a planned payment would trigger it first.
Phased retirement: common questions
What is phased retirement?
For a defined contribution pot it usually means phased drawdown, as above. HMRC's manual says defined benefits arrangements cannot pay drawdown pension, so how a final salary scheme such as the Local Government Pension Scheme or the NHS pension lets you take benefits in stages is for that scheme to say; an adviser can unpick it for nothing if you send your question through the enquiry form. See drawdown from the LGPS.
How long can phased retirement last?
HMRC says the tax rules set no maximum age by which pension benefits must be put into payment. Your scheme's terms and the size of the pot set the practical limit, and MoneyHelper warns that many people underestimate how long retirement lasts.
Is phased retirement a good idea?
That depends on the person, and this page does not recommend it. MoneyHelper sets flexibility and spreading withdrawals across tax years against income that is not guaranteed and money running short if too much comes out early. Pension Wise can talk it through free; annuity or drawdown covers the other main route.
How can I work out what phased retirement would pay me?
MoneyHelper offers a calculator that estimates how long a given level of drawdown income could keep going. Any result rests on assumptions about growth, charges and lifespan, so treat it as an illustration.
What can I do with a slice later on?
MoneyHelper says that once a pension is in drawdown you can still choose another route: leave it and retire later, convert some or all into a guaranteed income, or take it all in one payment. Read switching from drawdown to an annuity.
Choosing the size of your first slice
A staged pension lets you move one slice at a time, usually take a quarter of it tax-free within the lump sum allowance and leave the rest untouched, at the price of investment risk, a possible emergency tax code and a lower contribution limit once taxable income starts. Sizing a first slice around your allowance, tax position and plans takes your full figures. Book a ring-back with this page's short form, and soon after, an FCA-authorised adviser walks through those numbers with you, charging nothing for that call.
Sources, accessed 22 October 2026: HMRC Pensions Tax Manual (PTM062701, 062730, 063210, 063220, 063230, 063300, 062100, 062205, 056520, 056510); HMRC PAYE Manual (PAYE76170, 94055); GOV.UK (how you can take your pension, lump sum allowance, how your tax is paid, pension tax refunds); Finance Act 2022, s10; MoneyHelper (drawdown, Pension Wise; archived copies). Our working: 22 October 2026.