Given the UK’s current obsession with property and its rise and then sharp fall in value, it’s fairly safe to assume that most people are familiar with the term ‘Equity Release’ – or unlocking the money tied up in the value of your home. But what if you have no equity in your home, yet still need to release cash? The answer could lie in Pension Release.
‘Pension Release’ or ‘Pension Unlocking ‘is the term used to describe the taking of the benefits of a pension before the normal retirement age. This could be in the form of a tax-free lump sum, monthly income, or a combination of the two. Alternatively, you might want to take a cash-free lump sum and invest the balance to provide you with an income when you do come to retire.
There are strict guidelines surrounding Pension Release. To qualify, you need to be between the ages of 55 and 62 and have a UK pension that you are no longer contributing to and are not currently receiving benefits from. This could be a personal pension or company pension. It’s possible, for example, that if you have worked for a number of companies over the years, then you might have more than one pension. Even if you have not paid into them for a number of years you could still release the cash early through pension release.
The whole point of making contributions to pension schemes is, naturally, to provide an income during retirement. It is therefore important to be aware that releasing your pension benefits early could reduce your income and your standard of living at retirement. This is why Pension Release is only suitable for a limited number of people and circumstances.
Many people have tried to unlock the cash in their pensions by approaching their pension provider directly. Unsurprisingly many providers are reluctant to approve pension release and to further confuse the issue there are complex clauses and legal jargon at every turn. For these very reasons it’s often better to contact a specialist pension release company. Reputable companies are regulated by the Financial Services Authority and will offer impartial advice in plain English. They will not advise you to release cash from your pension unless it is the most suitable option available to you.
Pension release has helped thousands of people to release the cash tied up in their pensions for a number of reasons, from consolidation of debts to paying for a major expense such as a wedding. It is only suitable in special circumstances but for many it has provided a financial lifeline at a time when they needed it most.

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Where your pension is paid into it - is a UK bank or U.S. bank - you arising in the UK are liable for tax on the UK incoem, subject to your annual tax free allowance. There is, however, which means that the U.S. and UK, the U.S. pension will also double taxation agreement between, they'll credit to any payments on the UK.

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Individual Voluntary Arrangement