Occupational Pensions - Section 32 Buy-out Policies

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Section 32 Buy-out Policies

Section 32 buy-out policies (sometimes referred to as pension transfer plans) were introduced so that occupational pension benefits could be transferred to a different provider without having to go into another occupational pension scheme.

They became less popular when personal pensions were introduced in 1988 but they are be useful for transfers from final salary or money purchase schemes as they remain under occupational rather than personal pension rules. Many people benefit from the additional flexibility that comes with a section 32 buy-out policy however unlike a personal pension they can only accept a one off single transfer. No further contributions can be made into the plan.

Once set up, it is a money purchase scheme which can be on a unit linked or with profit basis. The fund can be taken as a tax free lump sum and pension. Benefits can start between the ages of 55 and 75.

It is always a good idea to take financial advice before considering transferring a pension as there may be transfer penalties incurred. To talk to a financial adviser about what will be best for you, please complete the Quick Enquiry Form above and we will arrange for an impartial adviser to contact you.

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