Flexi-access Drawdown

Flexible investing

If you utilise the option to drawdown from your pension, you then have the freedom to select where the remainder of your pension is invested. It also allows you to make further withdrawals when you wish.

If you were in flexible drawdown before 6 April 2015 – or are in flexi-access drawdown after 6 April 2015 – and have taken any income, then your annual allowance is restricted to £4,000 for money purchase pension schemes. You will be unable to pay contributions in lieu of any additional unused relief from previous years.

How does Flexi-Access Drawdown Work?
It is vital you consider how you take your income, based on your personal circumstances. Consideration should also be given to how your income is taxed. Once you have taken your tax-free sum, you are not obliged to take any further income. Your plan can remain invested and you can either take a further income at a later date or leave it to be passed on to your loved ones when you die.

Income drawdown will reduce the size of your pension fund and in the investment growth may not be sufficient to maintain the level of income you wish to draw. If you withdraw money at a rate greater than the growth achieved by your investments, your remaining fund will reduce in value. The level of income you take will need to be reviewed if the fund becomes too small – this is more likely the higher level of income you take.

The value of an investment with St. James’s Place will be directly linked to the performance of the funds you select, and the value can therefore go down as well as up. You may get back less than you initially invested.

The levels and bases of taxation, and reliefs from taxation, can change at any time. The value of any tax relief depends on individual circumstances.