I was telephoned by a financial company telling me I can get the money out of my UK pension plan at any time, even though I am not retiring. When I questioned this they said there were new rules that allow people to take all the money out, but it sounds too good to be true. Is this correct? SB, Dubai
There has been a proliferation of these “pension liberation” offers and you are right – such an offer is too good to be true and these schemes are bogus. There are a few circumstances, such as in the case of terminal illness where it may be possible to access UK pension monies before the age of 55, but for most people this is illegal. These “liberators” take up to a third of the money in the fund, and even worse is that the pensions regulator has deemed this an “unauthorised transaction” and can levy a tax charge of up to 55 per cent of the fund. There are changes in legislation on the way that will allow people to access their full pension fund but only after they reach 55, and also with a tax charge. Options to transfer to other arrangements are legitimate but not always suitable, so for all pension issues it is important to take professional advice.
Keren Bobker is an independent financial adviser with Holborn Assets in Dubai, with over 20 year’s experience. Contact her at keren@holbornassets.com
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