New annuity options April 2011
In the 2010 Budget, the Government announced that with effect from 6 April 2011, the requirement for individuals to use their pension fund to purchase an annuity by age 75 will end.
Under the proposals, if an individual can demonstrate that they satisfy a Minimum Income Requirement (MIR) they will be able to drawdown amounts from their pension pots for an unlimited period (Flexible Drawdown), subject to Income Tax at their marginal rate. The intention of the MIR is to ensure that an individual will not fall back on the State after exhausting their retirement savings.
To satisfy the MIR, the individual must have a guaranteed lifetime income of at least £20,000 per year. Included in the MIR are State Pensions, income from defined benefit pensions and annuities (including non-increasing and single life annuities). The MIR is measured on an individual basis with no higher allowance for married couples.
You can find the HMRC article here.
Options within the IBM Pension Plan
The IBM Pension Plan does not offer in-house annuities for M Plan Members and does not have the facility to offer Income Drawdown.
Members who would like to drawdown have the option of transferring either all or just the AVC/ASC element of their M Plan Retirement Account to a suitable external policy.
Last Updated: 11/03/2011
