Can I take a lump sum when I retire?

When you retire, you can take part of your pension as a lump sum, this is normally paid tax free.

  • If you were a member of the Scheme before 1 April 2008 you are automatically provided with a lump sum.
  • If you are a member after 1 April 2008 the Scheme no longer provides an automatic lump sum, but you can give up some of your pension for a lump sum.

If you want to take a lump sum, or increase the size of your lump sum, you have to give up £1 of pension to earn lump sum of £12.

You must tell us if you want to give up pension for lump sum before you retire. You can use the 'Trading your Pension for Lump Sum' form to do this.


When Jane retires she has built up the following benefits: 

Pension = £6,667 a year

If Jane wants to take a £20,000 lump sum she will need to give up £1,667 of her pension.

Lump sum ÷ 12 = amount of pension you need to give up.

Her benefits will be: 

Pension = £5,000 a year, Lump sum = £20,004