In the Budget held on 19 March 2014, some changes as to how pension benefits can be taken at retirement were announced.
One off cash lump sum (trivial commutations)
The value of retirement benefits that can be taken as a one off lump sum increased from £18,000 to £30,000. This means that members whose total retirement benefits (excluding any State Pension) are worth £30,000 or less, may be able to take their benefits as a one off lump sum, provided they meet certain conditions.
The Trustees are planning to write to KPS-FS members who may benefit from this option over the next 12 months. However if you wish to find out if you are eligible now please contact Kingfisher Group Pensions.
KPS-MP Retirement Options
From April 2015, members of the KPS-MP will no longer have to use their Retirement Account to purchase an annuity at retirement. New rules have been introduced where members will have the option to take their Retirement Account anyway they wish. This could be as a whole lump sum or to draw it as income as and when required.
Members will still be able to take 25% (1/4) of the value of their Retirement Account as a tax free. But anything above this will be taxed at your marginal rate of income tax.
The Government will announce further details in the Autumn of 2014 as to how this will work and the Trustees will be looking at ways these changes can be made available for members.
If you are considering taking your retirement benefits from the KPS-MP in the coming months, you may wish to factor the changes outlined above into your retirement planning.
Members of the KPS-MP are contacted by Hargreaves Lansdown, who will provide information to help members plan and review their options at retirement. When the members come to choose and compare their retirement options, they can view the wider choices available, such as income drawdown. To review this information now you can access it via their website by clicking here.
This website will be updated over the coming months with further information as it is known, however please feel free to contact Zurich, or the Kingfisher Group Pensions Department should you have any queries.
Links to other sources can be located on the right hand side of the column.
