When you reach retirement, you can purchase an annuity or enter into income drawdown via Capped Drawdown or Flexible Drawdown. You can take up to 25% of your fund as a tax-free cash lump sum and leave the remainder of your pension fund invested. In the meantime, you can take income as and when you need it from the fund; subject to certain Inland Revenue limits. You can use an income drawdown calculator to help you work out much you can take from the fund. However, you are not obliged to take any income at all if you do not need it.
Income Drawdown Calculator
The Income Drawdown Calculator will let you calculate the maximum possible income allowed from Capped Drawdown under the HMRC rules. Use the income drawdown calculator to find out if the income would be more than that you could receive under an annuity. The calculator is very simple to use and only requires minimal information to produce a result. Try it now.
