What is flexi-access drawdown?

Flexi-access drawdown is pension income that may be taken directly from the member's SIPP or SSAS funds, having no upper limit. 

This feature was introduced from 6 April 2015, with any client wanting to start taking benefits, including drawdown, has to opt for flexi-access drawdown. At the same time flexible drawdown automatically became flexi-access drawdown.

How does flexi-access drawdown work?

When designating funds for drawdown, the client can normally take 25% of those drawdown funds as a tax-free pension commencement lump sum (subject to their available lifetime allowance) and then take drawdown income from the balance, which remains invested. The drawdown income is assessable income for tax purposes and will normally be paid on the 1st of each month (subject to the usual bank clearing system). Dentons will apply normal PAYE rules to these payments from the individual scheme account.

Once the client has taken their first flexi-access drawdown income payment from any pension scheme, the money purchase annual allowance of £10,000 will apply to them.  

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

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