How will tax be deducted?
Hargreaves Lansdown, like all pension providers, is required to deduct tax, where applicable, before any withdrawal is paid out. Usually 75% of each lump sum taken will be subject to PAYE Income Tax. If you make a large withdrawal this could push you into a higher tax bracket. HM Revenue & Customs rules mean that your income could initially be taxed under an emergency tax code, find out more by using our emergency tax calculator. Any excess tax deducted may have to be reclaimed from HMRC directly. Tax rules can change and tax liability depends on your circumstances.