More about the All Cash option

Understanding the basics

  • Withdraw all of your Defined Contribution (DC) pension pot as cash lump sums

    You can take your DC pension pot as one or two cash lump sums (split between two tax years). If you decide to take your DC pension pot as two separate cash payments, the first cash payment will be paid at your selected retirement date and the balance will be paid shortly after the start of the tax year following your selected retirement date, usually at the end of April. If you would like to take your DC pension pot as more than two lump sums, you will need to transfer your benefits out of the Scheme.
  • Take up to 25% of each lump sum tax-free

    Normally 25% of each lump sum can be paid tax-free (up to the Lifetime Allowance), but the remaining 75% will be subject to income tax. Watch out because this could push you into a higher tax bracket as your income is not spread out.
  • Remaining cash from your lump sum will be included in your estate

    No specific pension provision will be made for your partner or dependants after you die. However, any remaining cash from your lump sum would normally be included in your estate.

Things to think about:

  • Remember to factor in inflation when thinking about future plans

    It’s up to you what you do with your cash lump sum(s), but you may want to think carefully about your plans. Don’t forget, inflation reduces the spending power of cash so you should think carefully before just leaving it in your current account for a long time.
  • Think about investing

    You can invest the cash lump sum(s) outside of a pension arrangement, and use it as and when you wish. Remember, the value may fall as well as rise, depending on where/if you invest it.
  • Limited to the Money Purchase Annual Allowance

    By taking the cash lump sum(s), the contributions that you or your employer can make tax efficiently to a DC scheme will be limited to the Money Purchase Annual Allowance.
  • No regular income will be provided

    Taking your DC pension pot as one or two cash lump sum(s) will not provide you with a regular income and you will need to manage your spending and investments to make sure you have enough income throughout retirement.
  • You can’t change your mind

    Once you have taken your first cash lump sum payment, you can’t ch ange your mind about taking all your DC pension pot as cash or about when you receive your second payment.
  • If you want to take more than two cash lump sums

    If you would like to take your DC pension pot as more than two lump sums, you will need to transfer your benefits out of the Scheme.

The All Cash option and tax

What should I do next?

If you are thinking about taking your DC pension pot and would like to get a retirement quote or request a retirement pack, you can do this by logging-in to My Pension. Once logged in, select the Quotes drop down menu. Please note you can only request a retirement quote if you are aged 54 or over.

Alternatively, you can contact the Scheme administrators directly.

Additional help to make your choices

Have you watched a retirement webcast?

Our retirement webcasts are designed for members aged 50 and over, to help you understand more about your retirement income options. Click to watch the full series of Retirement webcasts for members over age 50.

Have you tried our Pension Freedom Planner?

If you want to understand more about how much cash you could take, why not login to My Pension and use
the modeller called the Pensions Freedoms Planner

Quick links to external help sources

Explore the Retirement Options

Retirement options overview 

There’s plenty to think about when planning for retirement - do you need flexibility or income certainty? Be in control or hands-off? Would a combination of options be better? Our retirement options overview is a great place to start to understand the basics, compare the options and get extra pointers to help you decide.

Drawdown Income 

Keep your money invested and take a flexible income from it. Take as much or as little as you need, when you need.


An annuity provides a secure, regular income for life that you buy from an insurance company.