How do the new UK pension flexibilities affect my defined benefit/final salary scheme?

27 March, 2017

While the new UK pension flexibilities are enabling people to manage their pensions much more freely, for those with public sector defined benefit schemes, the UK government has banned any transfer to other types of pensions (like personal pensions) to take advantage of the increased flexibility. As the majority of public sector schemes operate on an unfunded basis, out of general UK taxation, if more people were to transfer out this could expose the UK Treasury to significantly higher annual costs.

However, transfers from private sector defined benefit schemes to defined contribution/personal pensions (excluding pensions in payment) can continue, subject to any person wishing to transfer receiving the required financial advice.