Our January 2016 news article  summarised the changes introduced by the government in April 2015, which give members of defined contribution (DC) plans such as the Experian Retirement Savings Plan (ERSP) much more flexibility over their benefit options at retirement.

Since April 2015, the law additionally allows DC members to:

• take a single cash sum of up to 100% of your account, 25% being tax-free and the remaining 75% being taxable, some or all of which may be at the higher tax rates (currently 40% and 45%), or
• take smaller, multiple cash sums, in which case 25% of each cash sum is tax-free with the remainder being taxed (known as ‘uncrystallised fund pension lump sums’ or ‘UFPLS’), and
• take smaller taxable cash sums as and when required, with the option of taking up to 25% of your account as tax-free cash at retirement (known as ‘flexi-access drawdown’, ‘FAD’, or ‘drawdown’).

We are pleased to confirm that a limited UFPLS facility has now been launched under the ERSP for a period of up to three years following your retirement date.

Full details of the UFPLS facility will be included in retirement packs provided by the Experian Pensions team at Capita. Any members who wish to take advantage of FAD or require UFPLS for longer than three years, will need to transfer their savings to an external arrangement like a personal pension, as drawdown is not available under the ERSP.

You are strongly recommended to seek professional financial advice if you are unsure which benefit is appropriate for you based on your personal circumstances. The government has also introduced Pension Wise, a free and impartial government service which has been launched to help you understand your options at retirement. Visit www.pensionwise.gov.uk or call 0800 138 3944 for further details.