Flexible Drawdown is a form of ‘income withdrawal’ where your pension income is paid direct from your pension scheme.
Unlike with Capped Drawdown, Flexible Drawdown allows you to take as much or as little income each year as you like. Should you wish to do so, you can even take out all the funds from your pension as one single income payment.
However, not everyone is eligible to use Flexible Drawdown.
You must be receiving a minimum amount of £20,000 per annum (reducing to £12,000 from 27 March 2014) of secure pension income to qualify for Flexible Drawdown. Other rules also apply.
For more information about Flexible Drawdown and the current eligibility rules, you can visit the HMRC website by clicking here.
Note: Although the tax rules allow registered pension schemes to offer flexible drawdown, it does not require them to do so. All Flexible Drawdown related pension income payments are taxed under PAYE.