Can I take tax-free cash?

You may be able to take up to 25% of your existing pension fund as tax-free cash. However, if your pension monies are coming from a drawdown plan, you will have already taken your tax-free cash.

What are my income payment options?

Your income payments can: <ul> <li>Stay the same for the remainder of your lifetime</li> <li>Increase by a fixed percentage every year; vary in line with the Retail Prices Index or vary in line with the Retail Prices Index but capped at 2.5% or 5%</li> <li>Be paid into your bank account monthly, quarterly, half-yearly or yearly</li> </ul>

How is my income taxed?

We’ll tax your income at your marginal rate once we receive a tax code from HMRC or you provide a valid P45 certificate. If we don’t receive this, we’ll apply a temporary, emergency tax code. The amount of income tax you pay will depend on your total income from all sources and your personal allowance.

What happens to my income when I die?

Your income will stop when you die, unless you have opted to include death benefits. The options are: <ul> <li>Guarantee payment period - you can choose for your income to be guaranteed for a period of time (from 1 month to 30 years). If you die within the guarantee period, your chosen beneficiary(ies) will continue to receive your income until the guarantee period ends</li> </ul> <ul> <li>Payments to a second annuitant - you can choose to provide an income for a second annuitant after your death. This can be at the same level or at a lower percentage, for example 50% of the amount paid to you</li> </ul> <ul> <li>Value protection - you can choose to have a lump sum paid when you die. This is a way of protecting your initial investment minus any income you’ve already received</li> </ul> If you die prior to your 75th birthday, we’ll make tax-free lump sum payments or provide tax-free income to your beneficiary(ies). If you die after age 75, we’ll tax any payments at your beneficiary(ies) marginal rate of income tax.

As we don’t give personal recommendations on our products, you should make sure this annuity is right for you before you make a purchase. Visit our <a href="https://www.canadalife.co.uk/customer-support/find-a-financial-adviser/">find an adviser</a> page for tips on getting professional advice and taking advantage of government-backed support services.

Lifetime Annuities & Scheme Pension

A secure, regular income for life

Our lifetime annuity uses the money saved in your pension plan to give you a guaranteed, regular income for life. You can also choose to provide an income for your chosen beneficiary(ies), like a spouse or partner. Once you’ve set up your policy, you can’t normally revise or cancel it so we recommend that you seek professional advice before you apply.

If you have recently received a letter regarding tax code changes that may impact the tax you pay on your annuity income, you may need to contact HMRC to discuss your taxation position. You can do this by logging onto your online Personal Tax Account via www.gov.uk, calling the helpline on 0300 200 3300, or via post Sefton Area, HM Revenue & Customs PAYE, PO Box 1970 Liverpool, L75 1WX.

If you have any questions about this letter or need assistance in understanding any of the points raised, please contact retirementservicing@canadalife.co.uk

Is the Lifetime Annuities & Scheme Pension right for you?

Option for your income to increase over time

What are the risks?

Just so you're aware, we're unable to change the terms of your annuity policy once we've set it up. Your income will stop when you die unless you opt to include death benefits. Inflation will reduce the spending power of your income, especially if you haven't chosen a rising income. Tax rules depend on individual circumstances and may change. Other annuity providers may provide you with a better outcome.

This product may be right for you if:

You are aged 55 or over
You want to take benefits from your pension equal to at least £10,000 after you’ve taken tax-free cash
You need a guaranteed lifetime income
You want your loved ones to receive an income and/or lump sum after your death

This product will not be right for you if:

You have less than £10,000 of pension savings to invest after you’ve taken tax-free cash
You want to grow your pension savings and/or need flexible access to your money
You want to make personal contributions
You want to withdraw all of your funds immediately in one go

Frequently asked questions

Your income payments can:
- Stay the same for the remainder of your lifetime
- Increase by a fixed percentage every year; vary in line with the Retail Prices Index or vary in line with the Retail Prices Index but capped at 2.5% or 5%
- Be paid into your bank account monthly, quarterly, half-yearly or yearly
We’ll tax your income at your marginal rate once we receive a tax code from HMRC or you provide a valid P45 certificate. If we don’t receive this, we’ll apply a temporary, emergency tax code.

The amount of income tax you pay will depend on your total income from all sources and your personal allowance.
Your income will stop when you die, unless you have opted to include death benefits.

The options are:
- Guarantee payment period - you can choose for your income to be guaranteed for a period of time (from 1 month to 30 years). If you die within the guarantee period, your chosen beneficiary(ies) will continue to receive your income until the guarantee period ends
- Payments to a second annuitant - you can choose to provide an income for a second annuitant after your death. This can be at the same level or at a lower percentage, for example 50% of the amount paid to you
- Value protection - you can choose to have a lump sum paid when you die. This is a way of protecting your initial investment minus any income you’ve already received
If you die prior to your 75^th birthday, we’ll make tax-free lump sum payments or provide tax-free income to your beneficiary(ies). If you die after age 75, we’ll tax any payments at your beneficiary(ies) marginal rate of income tax.

Need an adviser?

Need an adviser? A financial adviser can help you get a tailored quote for our products. Read up on how to find an adviser and what to expect from the advice process.

Find a Financial Adviser