Advantages of a pension

What are the advantages of a pension?

Advantages

Tax relief from the government, added automatically (25% bonus).
Claim back 40% or 45% tax if you’ve paid it on your income.
Grows tax-free (you might pay tax when you withdraw it).
25% can typically be withdrawn tax-free (up to £268,275).
Passes to your family tax-free if you pass away under the age of 75.

To consider

Save up to your yearly income each tax year (with a maximum of £60,000).
Can’t withdraw until you’re 55 (57 from 2028), or terminally ill.

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By making an investment, your capital is at risk. The value of your investments depends on market fluctuations outside of our control and you may get back less than you invest. Past performance is no indicator of future performance. The tax treatment of an ISA and a pension depends on your individual circumstances and may be subject to change in the future. You should seek financial advice if you are unsure about investing.

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