Skip to main content
  • Register
  • Help
  • Contact us
  • Log out of your HL account
Tax matters

Taxes in
Retirement

Keep on top of your retirement tax bill

A lot can change when you retire. Including how much tax you pay.

We’ve gathered these resources to help you understand more about taxes in retirement and how your choices can affect what you pay. Remember, tax rules can change and benefits will depend on your own circumstances. So check carefully how tax rules will apply to you before making any decisions.

Taking tax-free cash from your pension

You can usually take up to 25% of your pension tax-free. The rest is taxed as income.

You can choose to receive all your tax-free cash in one go, or in stages. It’s up to you.

Find out more about your options

Taking taxable income from your pension

How much tax you pay will depend on how much income you receive each tax year. And making a withdrawal could restrict how much you can pay into pensions in the future.

You can use our pension income tax calculator to see how much tax you might pay on lump sum withdrawals.

Though, it’s likely you’ll be taxed using an emergency tax code the first time you make a withdrawal. Our emergency tax calculator can show you how much tax you might pay.

If you’ve flexibly accessed a pension you can only pay in up to £4,000 each tax year to money purchase pensions (which includes self-invested personal pensions and many workplace pensions). If you pay in more, there will be a tax charge. Find out more about how much you can put into your pension by reading our factsheet.

Passing on your pension

How you take your pension could change what your loved ones are able to do with anything left over. Pensions can usually be passed on free of inheritance tax. But how old you are when you die will affect the tax treatment of their withdrawals.

How your choices could affect your loved ones

Resources to help you plan

Pass on your wealth to loved ones

Learn what options your loved ones will have when you pass away, and how the tax works.

Download factsheet

Don’t pay more tax than you need to

Understand tax rules so you can make the most of your money.

Guide to saving tax in retirement

Need more help?

Our advisory service could help you make the right decisions for you.

Advisory service