Accessing your pension is straightforward and our app allows you to withdraw with ease when you reach 55 (rising to 57 from 2028). You can take up to 25% as a tax-free lump sum (or multiple lump sums), and leave the rest invested. Once you become eligible, our drawdown option gets activated automatically.
Before withdrawing money from your pension, we’ll ask you to confirm that you’re happy to go ahead with the withdrawal and have considered taking advice. You might be asked to complete a Facial Similarity Check (FSC) for a number of reasons. These requests are always made during your first withdrawal request.
To carry out a Facial Similarity Check, we’ve partnered with Onfido to provide our customers with a convenient and secure way to verify their identities. You’ll need to have a smartphone or tablet with a camera to take a selfie. Plus you’ll need to upload a copy of one of the following:
Unlike other providers we won’t charge you extra fees for drawing down your pension. However, if your pot has been with PensionBee for less than a year and you wish to withdraw it in full, then a full withdrawal fee of £150 applies. Including if the value of your account’s less than £150 at the point of withdrawal.
You can make one taxable cash withdrawal per tax month. Withdrawals must be paid into a UK bank account in the name and address of the customer (matching their PensionBee details). In addition, the bank must be directly regulated by the Prudential Regulation Authority (PRA). We’re unable to authorise payments to any bank accounts that don’t meet this criteria.
A pension annuity’s a financial product that pays you a guaranteed income for a fixed period or for the rest of your life. When you retire, you can choose to use some or all of your pension savings to buy an annuity.
We have a partnership with Legal & General to enable PensionBee customers to use their pension balance with us to purchase a pension annuity via Legal & General. Just go to our Pension Annuity landing page to find out more.
We do earn a referral fee of 1.25% of the total money used to purchase a pension annuity from Legal & General, however this doesn’t impact the annuity you’ll receive. If you’re still feeling unsure, you can watch our Pensions 101 video on what an annuity is on YouTube.
If withdrawal requests are made before 12pm on a working day, we’ll aim to make a trade request on that particular day. Requests made after 12pm may be processed the following working day. As long as there are no issues verifying your bank details, it should take around 10 working days for you to receive your money.
There’s no forms to sign as everything is done digitally, including your emergency tax payment to HMRC. Once the payment has cleared, your withdrawal will show as a ‘Withdrawal’ in the ‘Balance’ tab in your online account (known as your “BeeHive”). If you’re still feeling unsure, you can watch our Pensions 101 video on How to take your pension on YouTube.
You can take up to 25% of your pension pot tax-free, either as a lump sum or as a portion of each withdrawal. The remaining 75% of your pension pot is subject to income tax. When you withdraw a taxable lump-sum from your pension, an emergency tax rate will be charged until your individual tax code is received from HMRC directly.
As pension tax works in the same way as income tax, your pension provider will use the Pay As You Earn (PAYE) system to deduct any tax due before you receive your payment. For payments processed using an emergency tax code, under PAYE, any payments you receive will be treated as though they’re a regular salary or monthly income.
It’s important to understand how this impacts your pension plan. You can use our Pension Drawdown Calculator to estimate how much tax you’ll pay and how much you’ll have left in your pension pot. MoneyHelper and Pension Wise offer free impartial financial guidance. They can help you understand your options and make the best decision for your individual circumstances.
You may be able to reclaim emergency tax on your withdrawals by contacting HMRC directly, and completing a tax claim form. Please keep the payslip we issue when you make a withdrawal in a safe place, and refer to it when contacting HMRC. If you’re still feeling unsure, you can watch our video on How does pension drawdown tax work? on YouTube.
We understand that losing a loved one is a challenging time, so each claim will be handled by a specialist Compliance Manager at PensionBee. To notify PensionBee about the passing of a customer, the next of kin or executor of the estate should get in touch with us. If they need to notify us, they can call us as a first step. If they’re unable to call, they can send us an email.
For security reasons and to locate the customer’s account, they’ll need to provide the following:
Once we receive this information, we’ll update our records to reflect the bereavement. We’ll also send a form that needs to be filled out and returned to us.
To begin the review of any death benefits that may be payable from the customer’s plan, the form must be completed in full and returned along with the final death certificate and any other relevant supporting documents. The Compliance Manager will confirm any further requirements upon return of the form and provide guidance on next steps.
We can’t provide a definite time frame for the completion of our review, approval of beneficiaries and associated payments. This is because the process involves multiple parties and we rely on third parties for certain aspects of it. The final decision regarding who any death benefits will be paid to lies with us as scheme administrator and trustee.
While the answer’s generally yes, there are a few things you need to be aware of before making the decision to transfer a pension in drawdown.
If your current pension’s in Capped Drawdown, it’ll be converted to Flexi-Access Drawdown. Flexibly accessing your pension after converting would result in you becoming subject to the Money Purchase Annual Allowance (MPAA).
Also you must transfer the entire value of a pot in drawdown because HMRC doesn’t allow splitting crystallised funds.
If your current drawdown product is giving you a regular monthly income, please note that this isn’t a feature we accommodate at the moment - you’ll need to make a new request each time you want to draw down part of your pension.
Please note, we can’t currently accept beneficiaries drawdown from other providers. If a customer passes away whilst with us, the accepted beneficiaries will receive the inherited pension as a lump sum death benefit.