Personal Pensions


You can take out a personal pension whether you’re employed or self-employed.

You can also have a personal pension (including a stakeholder pension) if you’re unemployed.

To take out a personal pension, you must be aged 18 to 75. You can also take out a stakeholder pension on behalf of a child.

If you are an employee who is a member of an occupational pension scheme, you may be able to take out a personal pension as well. From April 2006, you can save as much you like into any number of pension schemes. This applies to both personal and occupational schemes. There is no upper limit to the total amount of pension savings that you can build up, although there are limits on the amount of tax relief you will get.

A personal pension scheme will provide one or more of the following benefits:-

  • a pension during retirement, which can start at any age between 55 and 75
  • a tax-free lump sum on retirement of up to 25% of the pension fund which has been built up from your contributions and interest and/or bonuses paid by the pension provider
  • a pension payable to your widow, widower, civil partner or other dependant(s)
  • a tax-free lump sum, payable if you die before retirement, to your widow, widower, civil partner or other dependant(s).


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