Early pension release rules

Early pension release, or pension unlocking, means withdrawing money from your pension before the minimum age of 55 (57 from 2028). It's worth noting that if you’re looking to withdraw early HMRC will charge you up to 55% tax on whatever you withdraw, unless you meet specific conditions. As early pension release has such a costly penalty, no reputable pension provider would let you withdraw a pension early.

Can I release money from my pension?

Following recent pension reforms, you can now withdraw as much of your pension as you want from the age of 55. There are some exceptions that entitle you to access your pension earlier, but you may have to pay high fees to do so. Whatever age you decide to withdraw your pension, there are a few things you’ll need to consider.

Pension release over 55

Once you’ve had your 55th birthday, you’ll be allowed to release money from your personal or workplace pension.

You can withdraw up to 25% of your pot tax-free, either as a lump sum or in smaller instalments adding up to 25%. It doesn’t matter how big or small your pension pot is, everyone over 55 is entitled to take a quarter of their savings without paying income tax.

When deciding what to do with the remainder of your pension, there are four main options to consider. You can cash out your pension and withdraw your entire pot in one go, or in a series of lump sums. If you choose this method it’s important to consider the tax implications, as large withdrawals can push you into a higher tax band, especially if you’re still employed and earning a salary.

If you’d like to receive a regular income from your pension you can use some or all of your pot to buy an annuity. This will provide a stable income either for a fixed term or until you die, depending on the annuity you choose. You also have the option of withdrawing money regularly, while keeping the rest of your savings invested with drawdown. This option enables you to take out as much or as little as you need, while giving your pension savings the chance to grow further.

But while taking your private pension at 55 (57 from 2028) may sound appealing, you don’t need to take your private pension at 55 at all. An alternative is to not release the money in your pension at all, and keep it invested for as long as possible. The longer you leave your money invested, the more time it has to grow and, if you don’t need to release your pension early for financial reasons, it could pay off in the long-run to wait.

Pension release under 55

Taking your pension before 55 isn’t against the law, but it’s not recommended due to the large fees you’ll be charged. You also risk running out of money before retirement and having to work much longer than you’d planned.

There are some instances where you can release your pension before 55, but you’ll need to meet certain conditions. If you have poor health or a serious medical condition, for example, you may be able to access your pension early. If you’re younger than 55 and have been given less than a year to live, you could be entitled to take your whole pension pot as a tax-free lump sum.

It may also be possible to access your savings early if your pension includes a protected retirement age (PRA), which outlines the age at which you can begin accessing your savings. A PRA would have to have been granted before 6 April 2006 to be valid and is usually only applicable to certain professions where early retirement is typical, such as professional sports.

When transferring a pension which features a PRA to a new provider, the PRA may no longer apply to the new pension scheme you’re transferring into. Having a pension without a PRA means you won’t be able to access your pension early, before the normal minimum pension age, currently 55 (57 from 2028).

If none of these circumstances apply, HMRC may view your early pension release as unauthorised, and you’ll be charged up to 55% tax on the amount you withdraw. Because of this it’s highly unlikely that a reputable pension provider will help you release your pension early, which means a third party will need to do it for you. They could charge you up to 30% to do so, leaving you with just 15% of your pension overall. Usually the firms that arrange early pension release for under 55’s aren’t authorised by the Financial Conduct Authority, which means you’ll have no protection if anything goes wrong.

There are numerous pension scams that claim they can help you access your pension before 55 by exploiting loopholes in the system. Unless you meet some of the criteria mentioned above, or have been explicitly informed by your pension provider that you qualify for early pension release, you shouldn’t trust a third party to act on your behalf.

PensionBee does not permit unauthorised payments, before the age of 55, under any circumstances. We’ll report any suspicious attempts to withdraw money from your pension and will share any non-personal information we gather with other pension providers.

Taking money out of a SIPP before 55

The rules for accessing your pension at 55 or earlier are the same for those with a Self Invested Personal Pension (SIPP). There are considerable downsides, both in terms of pension longevity and tax charges.

Can I take my money out of NEST before 55?

NEST typically doesn’t allow access to your pension before the age of 55, unless you’re unable to work due to illness or you’re suffering from a serious health condition. In these circumstances, you’ll need a doctor or registered practitioner to confirm your medical condition.

Pension release rules

Here are some of the key things you should remember when considering early pension release.


  • Consider your options carefully: before you make any decisions about early pension release it’s important to calculate how much money you have, and how long it will need to last you. Our pension calculator can help you do the sums and demonstrate how much you can realistically afford to withdraw.

  • Speak to your pension provider for more information: if you believe that you’re eligible for early pension release due to ill health or a protected retirement date, you should contact your pension provider for more information. If you think you can access your pension early for another reason, check the details of your scheme and still speak to your pension provider in the first instance.


  • Share any details about your pension: beware of anyone who contacts you out of the blue offering a free pension review, or who claims they can help you release your pension before 55. You could receive a phone call, text message, email, letter or be approached in person so it’s important to be vigilant with anyone who enquires about your pension.

  • Keep something suspicious to yourself: if you or someone you know has been approached about early pension release and you think it may be a pension scam, you should report it. Call the Financial Conduct Authority’s helpline on 0800 111 6768 or visit the FCA website.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

Last edited: 07-09-2022

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