Unsecured and Alternatively Secured Pensions.

Prior to April 2011, Unsecured Pension (USP) and Alternatively Secured Pension (ASP) were drawdown options at retirement. These have now been replaced by Capped Drawdown and Flexible Drawdown.

However, for clients who are already in drawdown through the previous options, different drawdown limits may apply.

Unsecured Pension

If your client had elected to draw an income through USP, their income limits continue to apply until they reach their first scheduled review date after 6 April 2011. For some clients this could be 5 years away.

At the next review, income is recalculated on the new Capped Drawdown basis. A review of limits will also apply if your client changes Provider.

Alternatively Secured Pension

ASP is reviewed annually and will be subject to the new Capped Drawdown limits at the first review after 6 April 2011. At this stage, your client may be able to stop drawing an income if they are only doing so to meet the minimum drawdown rules that applied prior to April 2011.