To take your pension tax-free lump sum, ask the provider or scheme that holds the pension, decide what happens to the rest, and pass its checks.
A Pension Wise appointment can explain the choices a defined contribution pension gives you before you ask for anything; MoneyHelper describes the service as free, impartial and backed by government. If the decision turns on more than one pension or on how you are taxed, this page’s enquiry form starts a no-cost phone conversation in which those pieces are treated as one set by an FCA-authorised adviser.
How to take your pension tax-free lump sum, step by step
The request goes to whoever holds the pension, and each firm runs its own process; GOV.UK’s advice is to ask your provider how money can be drawn from a defined contribution pension. The usual order:
- Check your age. Your scheme’s rules decide when you can take the pension, usually no earlier than 55 for now. Under section 10 of the Finance Act 2022, the normal minimum pension age is 55 until 6 April 2028 and 57 from that date, while uniformed services pension schemes stay at 55. When you can take your pension covers protected pension ages.
- Get guidance. Since 1 June 2022 the FCA has required providers to refer customers to Pension Wise, and explain what it is for, when they decide to access their savings, as Legal & General’s drawdown page sets out, adding that the wait for an appointment can be anything from a few days to several weeks. MoneyHelper offers online appointments to people aged 50 to 74, and you can have more than one.
- Ask which options your provider offers. A provider may not offer every way of taking money, and it might charge for cash withdrawals. If none of its options suits, the pot can move to another provider (how to transfer a pension).
- Decide how much cash to take and what happens to the rest (see the rest of the pension, below).
- Send the request in the way your provider uses, with the identity and bank details it asks for.
- Expect tax on anything beyond the tax-free part. The provider deducts it before paying you. How the tax-free quarter is worked out is in how much of a pension is tax-free.
What providers ask for, and how long payment takes
Provider pages read on 22 October 2026 show how much the process varies.
Royal London asks you to "get in touch with us to go through the steps to take your lump sum" once you have considered your options. Customers with an existing Income Release plan can use its online form, which covers one-off tax-free payments, regular payments and closing the plan. It asks you to have your contact details, policy or plan number, National Insurance number and bank details ready, and the account must be a UK personal account in your name or joint names, not a business, Post Office or ISA account. To meet money laundering regulations it may verify your identity electronically through a third party, with a phone number for anyone who would rather not have electronic checks, and it asks you to confirm that a tax-free payment will not take you over your lump sum allowance. For these Income Release requests it says processing can take up to 5 to 7 working days, and a further 3 to 5 working days for the money to reach your account.
Legal & General’s Personal Pension Drawdown is open to people aged 55 or over with a defined contribution pension, and it accepts only transfers of a whole pot. Applications are online only, as it cannot process them over the phone, and need your current provider’s details, the estimated value of the pot, the policy number and your National Insurance number. Tax-free cash has to be taken at the outset, because none can be taken once the pot is in drawdown.
Aviva’s guidance says to contact your provider before deciding, since providers may offer different options, and warns that some older pensions give less choice over how cash is taken, so the policy’s terms are worth checking. Nest’s retirement pages (August 2026) say you take money out by logging into your Nest account; members aged 55 or over with more than £3,000 can take some each month, at least £200 a time, leaving at least £2,000 in the pot. Scottish Widows says that once you take all your pension as cash you cannot reverse the decision, and Royal London’s form says the same of a cash lump sum.
Other providers’ timings and paperwork depend on the provider and the plan. If you would rather not chase that yourself, an adviser can find out for you at no cost once your details are in the form. How long a pension withdrawal takes has more on timing.
Spotting a scam before you send anything
A request for pension cash is exactly what scammers target. The FCA’s pension scams page says the safest thing to do with a cold call about your pension is to put the phone down, and that being offered a so-called free review out of the blue is likely to be a scam. Some scammers even claim to act for the FCA or MoneyHelper. A scheme offering to help you release cash before you are 55 is, in the FCA’s words, "almost certainly a scam". Our pension scams guide covers the common tactics.
Choosing what happens to the rest of the pension
The tax-free cash and the other 75% are decided in the same request. According to GOV.UK, the rest can be taken as cash in whole or part, converted into a lifelong guaranteed income (an annuity), or invested to provide a regular income you can adjust (flexi-access drawdown). Leaving the pension untouched is possible too, though Scottish Widows cautions that deferring past your selected retirement date could lose guarantees that apply only at that date.
The cash does not have to come all at once. Royal London describes taking it in one go or as a series of smaller lump sums, with the first 25% of each payment tax-free and the rest taxed as income. Aviva describes it another way: each time you take tax-free cash, three times that amount moves into a drawdown account that stays invested within the pension. The routes are compared in drawdown against UFPLS, taking a pension a slice at a time, the uncrystallised funds lump sum and choosing an annuity or drawdown.
Anything left invested, in drawdown or not, may lose value as well as grow, so what you eventually draw could be less than what was paid in. Taking taxable income on top of the cash can also affect later pension saving, as the money purchase annual allowance explains, and setting up drawdown covers the investment choices.
How much of the quarter to take now, and how it fits with your other income and pensions, depends on your own figures. Wondering which way yours point? Completing the form on this page for a call-back leads to a free call where every pension you hold is looked at in the round by an FCA-authorised adviser.
The lump sum allowance and protected amounts
The lump sum allowance caps tax-free lump sums at £268,275 in total, and Income Tax is charged on any lump sum that goes above your allowances. Lump sums from more than one pension and the lump sum and death benefit allowance go further.
A protected allowance can raise the tax-free amount. HMRC’s guidance on taking higher tax-free lump sums (last updated 6 April 2025) says anyone holding protected allowances should give their pension schemes the details, and anyone with enhanced protection should tell them as soon as possible so they know the pot’s value on 5 April 2023. Even then, no more than 25% of the pot can be taken, whatever higher tax-free amount is available. Each protection is explained in what replaced the lifetime allowance, primary, enhanced, fixed and individual protection.
Final salary and career average schemes
A defined benefit scheme pays an income rather than holding a pot, so any cash comes under the scheme’s own rules. HMRC’s Pensions Tax Manual at PTM063240 notes that in some circumstances a scheme has no set lump sum entitlement, and a lump sum may only be given by commuting, or giving up, part of the scheme pension. MoneyHelper notes that in some schemes a lump sum now means a lower income later. The scheme sets the terms, so ask it for the figures. Cash from a final salary pension, the allowance in defined benefit schemes, the NHS pension lump sum and claiming a USS pension cover particular schemes, and trivial commutation covers very small pensions.
Tax-free cash claims: what people also ask
What does "pension commencement lump sum" mean on my provider’s forms?
It is the legal name for the tax-free lump sum a scheme may pay when you become entitled to pension benefits; HMRC’s PTM063210 says the legislation calls this type of payment a pension commencement lump sum. Taking 25% of each lump sum instead is covered under uncrystallised funds lump sums.
Can I ask for the cash over the phone?
That depends on the firm. Legal & General takes drawdown applications only online and Nest members withdraw by logging in, while Royal London invites you to get in touch to go through the steps. Other providers set their own routes.
How does my provider know how much allowance I have already used?
It is up to you to keep count: GOV.UK requires you to total the allowance already used across every scheme you belong to. Royal London’s Income Release form asks you to confirm a tax-free payment will not exceed your allowance, and HMRC asks holders of protected allowances to give their schemes the details.
How long do I have to start taking the rest after the tax-free cash?
GOV.UK gives 6 months from taking the tax-free lump sum to start taking the remaining 75%, which is usually taxed. Your provider can tell you how its own process handles that.
Getting the request right first time
Asking for the cash takes minutes; undoing it is hard. Before you send anything, it helps to know how much of your allowance is already used, what the rest of the pot will do and roughly what tax the taxable part could bring. Those three checks, made for your own case, are the kind of thing the FCA-authorised adviser who returns your call can work through without a fee; leave your number in the form to arrange it. Once the money has arrived, what to do with your tax-free cash picks up from there.