Huge numbers risking a double tax hit on their pension

Data from the Financial Conduct Authority⁴ shows that the number of pension pots accessed for the first time in 2020–21 totalled 596,080; the number fully withdrawn totalled 341,404. Only 33% of consumers taking money from their pension for the first time took regulated advice.

People cashing in pension pots without taking advice could be putting themselves at risk of paying more tax, and those cashing in pots in one go could pay up to 45% Income Tax on part of their withdrawal, while also losing Inheritance Tax protection.

⁴FCA, Dec 2021