Capped drawdown

Capped drawdown is no longer available to new investors. But if you have one you can take capped (limited) withdrawals and still invest more than £10,000 per year. Potentially you can invest new pension funds into one too.


It is also possible to convert from capped drawdown to flexi-access drawdown (to allow uncapped draw downs of funds). If you want to stay in capped drawdown, you can. 

Key points

  • You cannot take out a new capped drawdown. Flexi-access drawdown is now available
  • The maximum you can withdraw each year is about 50% more than a level annuity
  • No income has to be taken at all
  • For most people you can start at age 55
  • There is no upper age limit
  • The upper income limit is reassessed every three years for those under 75, based on age and fund size
  • The upper income limit is reassessed every year for those over 75, also based on age and fund size
  • In the event of death, the death benefits will now follow the same rules as flexi-access death benefits.
The key advantage to stay in capped drawdown, is that you can continue to take taxable withdrawals but not lose the £40,000 money purchase annual allowance. This is the ability to put up to £40,000 into a pension. See MPAA (money purchase annual allowance) for more details.


If you have a question about pension drawdown or want to know more about flexi-access drawdown in more detail and how it can benefit you, then contact us online or phone 0800 011 2713.

If you can't find the information you're looking for on the website, or you want to know more or have a question, or just want to chat through some details about your pension then please feel free to contact us, without obligation. Either contact us online or call 0800 011 2713.


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