What Are Uncrystallised Pension Funds?

Last updated: 22/08/2011

If you are thinking of accessing your pension funds and have been carrying out research regarding the subject, you may well have come across the term ‘uncrystallised pension funds’. If so, you could be trying to figure out what ‘uncrystallised pension funds’ actually are.

Since, the so-called, pensions simplification regime was introduced on the 6th April 2006 (officially known as ‘A-Day’), the names and descriptions for pension savings and pension payouts have changed beyond recognition.

To add to the confusion, yet another set of new pension rules came into force in April 2011 and so, it’s not surprising that ordinary members of the public need an interpreter to help them understand what they all mean.
Anyway, back to the subject!

The simplest definition of uncrystallised funds/benefits that applies for most people is that they are pension funds/benefits that have not been drawn yet.

There are a number of events that cause pension funds to become ‘crystallised’. In some limited circumstances, these can cause pension funds to become crystallised even though no income or tax-free cash lump sum has been taken.

Whether your undrawn benefits are in a personal pension, an AVC, an ex-employers final salary scheme or an old retirement annuity plan or whatever, the same rule still applies. If you haven’t taken a penny from them, then they are all usually classed as uncrystallised pension funds.

If you have uncrystallised pension funds and are looking to access your pension benefits, talk to an independent pension specialist. He/she will be able to guide and advise you on all of the available pension options available to you.

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