If your capital pension scheme was set up after 1987, it automatically includes savings balance protection. Savings balance protection guarantees that your beneficiaries as a minimum receive the value of your savings if you die before retirement.
Capital pension scheme
With a capital pension scheme, you get your entire pension savings paid out as a lump sum, and you can spend the money whenever and however you want.
Since 2013, contributions to capital pension schemes have not been tax deductible.
With a capital pension scheme, you can go on a world tour or buy an allotment, as you can have your entire amount of savings paid out as a lump sum. You can also choose to have it paid out in smaller portions.
Advantages of a capital pension scheme
- You can have your savings paid out from the date you reach your pension payout age.
- It is up to you how and when you want to spend the money.
- It is up to you whether you want to have your savings paid out as a lump sum or in portions.
- The return on your capital pension scheme is currently taxed at just 15.3% per year.
- Savings balance protection guarantees that your beneficiaries receive the value of your savings if you die before retirement.
Facts about capital pension scheme
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Annuity pension scheme
An annuity pension scheme gives you the financial freedom to maintain your standard of living, even though your active working life has ended.
Retirement savings scheme
A retirement savings scheme is typically paid out as a lump sum, which you can spend whenever you want.
Get an overview of your payout options
Time for retirement? The order in which you withdraw your pension savings may be very important. Get an overview of your payout options and make a pension plan that suits your needs.
