A reader asks at what age they can access their pension and how much tax they will have to pay
In our weekly series, readers can email in with any question about retirement and pension savings to be answered by our expert, Tom Selby, director of public policy at investment platform AJ Bell. There is nothing he does not know about pensions. If you have a question for him, email us at money@theipaper.com.
Question: How can I find out my protected pension age and when I can withdraw my first lump sum and how much tax will I pay?
Answer: The age at which you can first access a private pension or your “normal minimum pension age” (NMPA) is currently set at age 55. This minimum access age is due to rise to 57 from April 2028.
From 2006 to 2010, the minimum access age was set at 50, and some schemes allowed you to retain this lower access age under transitional arrangements established by the government at the time.
If you have a protected pension age of 50, the rise in the NMPA to 55 in 2010 and again to 57 in 2028 should not apply, meaning you have the option of accessing your retirement pot earlier.
Your scheme should be able to tell you if you have an existing protected pension age. If you do, one thing to be aware of is that if you transfer your pension to an alternative provider, you could lose the protected age and move to the standard NMPA.
There is still uncertainty over how the transitional arrangements for the increase in the NMPA from 55 to 57 will work. Broadly, if you are younger than 55 on 6 April 2028 then you will have to wait until your 57th birthday before you can access your pension.
But there are a few questions for those born between 6 April 1971 and 5 April 1973 who will be over 55 in April 2028 but not yet 57.
If you are aged between 55 and 57
If a pension saver has not yet accessed any of their retirement pot before 6 April 2028, then they will not be able to do so until they reach age 57.
If they have accessed their pension and bought an annuity – a guaranteed income for life – then the annuity payments will likely simply continue. It’s very hard to see how they could be stopped “mid-flow”.
Likewise, if the pension saver has accessed their pension and moved it to drawdown, they will likely be able to continue to withdraw money from these drawdown funds. Those with drawdown can take as much or as little money as they want, and they can also stop or start it when they want to.
The tricky part comes when we think of those who have taken part of their pension, and, perhaps, moved it into drawdown. But still have part of their pension they haven’t accessed – the “uncrystallised” part.
We don’t yet know what the rules are for this situation. On the one hand, it seems likely the pension saver won’t be able to access any more pension until they reach 57. But there are some people who will have set up an arrangement with their pension provider to regularly access chunks of their pension pot on a pre-arranged basis.
This is often called phased drawdown or drip-feed drawdown. If this arrangement was stopped mid-way, then this seems a cruel outcome for those affected.
We have been waiting for several years now for the government to clarify what the “transitional rules” are for this situation. We are now expecting some sort of clarity in the early part of 2026.
How much tax will you pay?
In terms of tax, when you reach your NMPA you will be able to access up to a quarter of your pot tax-free, up to a maximum of £268,275 over your lifetime. Any further withdrawals will be taxed in the same way as income.
One final thing to highlight is your minimum access age is simply the first point you can access your pension – it doesn’t mean you should access your pot at this age.
Accessing your fund as early as possible comes with various risks, including draining your fund too soon and potentially triggering a lower annual allowance (if you take taxable income flexibly from your pension). So make sure you’re thinking long-term and understand the consequences of taking your pension from such a young age.