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  • Taking your pension before you're 55 using a protected pension age

Taking your pension before you're 55 using a protected pension age

Unless you retire due to ill health, you must be at least 55 before you can start taking your pension. Before 6 April 2010 you had to be at least 50 before you could start your pension. In certain situations you may be able to take your pension before you're 55.

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When you can take your pension before you're 55

You may be able to start taking your pension before you're 55 if both of the following apply:

  • You were a member of a pension scheme before 6 April 2006.
  • On 5 April 2006 you had the right to start taking your pension before you're 55 from that pension scheme. This means you didn't need agreement from anyone else to take your pension - for example from your employer or scheme trustees.

The other conditions you need to meet depend on the type of scheme you belonged to on 5 April 2006 - more below.

If you meet the conditions below, you'll be given a 'protected pension' age for that pension scheme. This will be the age that you had the right to start your pension before 6 April 2006. For example if you had the right to start getting your pension when you're 48 your protected pension age for that scheme will be 48. This means that as long as you meet the payment conditions (see the section 'Conditions for paying your pension' below) you'll be able to start taking your pension when you're 48.

If you were a member of a personal pension scheme or a retirement annuity contract RAC)

You'll have a protected pension age if on 5 April 2006 you had the right to start taking your pension before you were 50. You must also have had a job that HM Revenue & Customs (HMRC) recognise as needing to pay a pension before age 50. Your scheme administrator can tell you if you if this applies to you.

If you were a member of a company or public sector scheme

You'll have a protected pension age if on 5 April 2006 you had the right to start taking your pension before you were 55. This right to take your pension before 55 must have been set out in the scheme rules on 10 December 2003. Your scheme administrator can tell you if this applies to you.

Technical guidance - which jobs can pay pensions before age 50

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Transferring your pension savings

A protected pension age only applies to your pension savings held in the scheme that qualifies. If you transfer them out of that scheme you'll lose that protection unless all of the following apply:

  • all your pension savings in the protected scheme are transferred to the new pension scheme as a single transfer
  • at least one other member of the protected scheme also transfers their rights to the same new pension scheme as part of the same transfer
  • you haven't been a member of the pension scheme receiving the transfer for more than 12 months before the transfer

If your transfer meets these conditions then your protected pension age will apply to your savings in the new scheme as long as their scheme rules allow it.

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Conditions for paying your pension

If you want to get your pension before you're 55 you must start taking all your pension savings in that pension scheme at the same time. So if you've built up pension in different pension pots in the same scheme they must all start to be paid at the same time.

If you start to take only part of your pension and leave the rest to be paid at a later date you won't meet the conditions for using a protected pension age. In this situation any payment made before you're 55 will be an unauthorised payment. Find out more by following the link below.

If you have a protected pension age due to being a member of a company or public sector scheme there are also restrictions on who can employ you after you start your pension.

Unauthorised payments from pension pots

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Losing your protected pension age through employment

If you have a protected pension age due to being a member of a company or public sector scheme there are conditions as to who can employ you after you start taking your pension. These conditions only apply if you start taking your pension before you're 55 using your protected pension age. These re-employment conditions vary depending on what your protected pension age is - see below.

If you have a protected pension age due to being a member of a personal pension scheme or retirement annuity contract these re-employment conditions don't apply.

Protected pension age less than 50

If you have a protected pension age of less than 50 there are usually no restrictions on who can employ you after starting your pension. So if you start taking your pension before you're 50 you can stay in employment with your employer. However, there are a few occasions when this isn't possible. For example, if you own or control the company that you work for you must leave the employment of that company before taking your pension.

Protected pension age 50 to 54

If you start taking a pension from your employer's scheme before you're 55 and you have a protected pension age between 50 and 54 you must stop working for your employer when you start your pension. You can start work straightaway for another employer as long as they're not connected to your previous employer or the scheme paying your pension. In some circumstances you may be re-employed after a break of at least a month - for example you may be re-employed by your old employer if your new job is different to your old job. Otherwise there has to be a break of at least six months before you can be re-employed by your old employer. For more guidance on who can employ you after taking your pension pot using a protected pension age, follow the link below.

Technical guidance on loss of protection due to employment

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Protected pension age - affect on your lifetime allowance

The lifetime allowance is the total amount of pension savings you can build up that benefits from tax relief. If your protected pension age is less than 50 your lifetime allowance may be reduced when you start getting your pension. Find out more about the lifetime allowance by following the link below.

If you start your pension before you're 55 your lifetime allowance will be reduced by 2.5 per cent for each complete year it started before you're 55. So for example if your pension starts when you're 46 there are 8 complete years until you're 55 and your lifetime allowance will be reduced by 20 percent. If your lifetime allowance is £1.5 million your pension savings can be worth £1.2 million before you're affected by the reduced lifetime allowance.

If your pension is being paid from one of the pension schemes that covers the uniformed services (such as the armed forces, police and fire services) your lifetime allowance won't be reduced. For a list of these schemes follow the link below.

Technical guidance - pension schemes where the lifetime allowance won't be reduced

Understanding the lifetime allowance

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More useful links

Technical guidance on protected pension ages

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