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Pension Credit and pension drawdown

(6 Posts)
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Daftbag1 Wed 02-Mar-22 13:55:52

I recently discovered a pension that I'd forgotten about. I will be paid it when I each 67yrs, however, I would like to draw down a sum of around £8500 now to make some purchases;

£2500 - 2 X adjustable beds
£1800 - credit agreements
£1300 - bedroom furniture
£1000 - clothing
£350 - disability aids
£1000 - heating bills and oil filled radiator
£500 - fridge freezer

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GrannyGravy13 Wed 02-Mar-22 13:58:13

I think you are allowed to draw down 25% of the pension value tax free, anything over that is taxable.

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GillT57 Wed 02-Mar-22 14:00:43

Yes, you are permitted, currently to take 25% of the pot value as a tax free lump sum.

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Daftbag1 Wed 02-Mar-22 14:05:11

I pressed post before asking will this drawdown affect our Pension credit.....the bulk would be paid out on the day of receipt?

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Happygirl79 Wed 02-Mar-22 14:11:12

Yes I think so only if by drawing down the money brings your savings above the permitted level to claim the benefit.

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Jane43 Sun 27-Mar-22 09:48:29

If I were you I would get advice, Age UK or Citizens’ Advice may be able to help although the latter are under extreme pressure. I have found the Money Saving Expert forums a very useful source of information, you just need to go on the site and register then you can ask a question on the relevant forum. I do know that any money drawn from the pension fund that exceeds the tax free 25% will be subject to tax and counted as income which may affect your pension credit entitlement for that year.

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