A pension transfer is when you move your pension pot from one scheme to another. You may be able to transfer all of your pension pot or just part of it, however, not all pension schemes will allow you to transfer only part of your pension pot. Before making any sort of pension transfer, you will also need to ensure that the scheme you wish to transfer too will accept the transfer.
You may want to make a transfer to or from your pension scheme if:
Before you initiate any transfer of your pension pot, you should consider if:
We would strongly advise getting advice before making any decisions about transferring your pension.
Please contact us and one of our pension advisers can give you independent advice on general pension rules and regulations.
In order to avoid these tax charges, there are conditions that must be. These conditions include:
You can transfer your pension pot to:
If your transfer doesn’t meet these conditions then the transfer payment will be an unauthorised payment. This will result in both you and your scheme administrator will have to pay tax on the transfer.
Unfortunately, there are some companies using misleading information to offer personal loans or cash incentives, enticing savers to unlock their pension pots early. This is known as “pension liberation”. In most cases, these companies will tell you that there is a legal loop hole they are able to use so that you will not have to pay tax. There is no legal loophole.
If you have any suspicions that a person or pension scheme may be engaging in a pension liberation scam, you should contact Action Fraud on 0300 123 2040.
You can transfer your pension pot even if it's already paying a pension. However, there is a condition to this being allowed. This condition is that the transfer must be on a ‘like for like’ basis - so the type of pension you will receive after the transfer must be the same as the type of pension you were receiving before the transfer.
In this situation, you must transfer all of the pension pot that is being used to pay your pension. If your transfer doesn’t meet these conditions then the transfer payment will be an unauthorised payment. This will result in both you and your scheme administrator will have to pay tax on the transfer.
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