Capped drawdown.

Capped drawdown enables your client to continue to control the underlying funds which remain invested in their plan. This gives them the flexibility to select the best time to lock into annuity rates, if this is their chosen route.

After payment of any tax-free cash lump sum, the remaining assets provide an income to the member determined by reference to Government Actuary's Department (GAD) tables. These tables set the maximum annual pension allowable and equate (approximately) to the annuity which could be secured by your client’s fund on the basis that there are no pension increases and no dependant's pension.

There is no minimum annual pension.

The maximum pension is limited to around 100% of the equivalent annuity and is reset every 3 years until attainment of age 75, and yearly thereafter.

Your client can vary the level of pension they receive on an annual basis.

For treatment of funds on death, please see Death benefits.