Amendment to minimum pension age rules

Matthew Barrand Pensions

On the 4th November, the government published the Finance Bill 2021/22 which includes an amendment to the normal minimum pension age rules that apply in advance of the change from 55 to 57 in 2028.

The minimum age at which people can access their pension will increase from 55 to 57 from 6 April 2028, except for those with a protected pension age and members of pension schemes relating to some uniformed services.

The draft legislation gave a window of opportunity for clients that would not have a protected pension age under any pension scheme, to find and join a pension scheme that would give them the ability to access from age 55, and, would also allow them to transfer in other pensions. The window was intended to run until 5 April 2023.

The Finance Bill issued on 4 November 2021 closed this window at midnight on 3 November 2021 as a result of feedback from the pensions industry stating that the proposed rules were too complex and could potentially lead to poor outcomes as individuals looked to transfer benefits solely for the purposes of obtaining a lower normal minimum pension age (NMPA). The risk of individuals falling victim to pensions scams was also likely to be increased.