Can I claim a private pension and work part-time?

8 October 2013


I was made redundant in June 2010 after 23 years' service. Soon after, I was lucky enough to find work with another company. I intend to reduce my hours at my new company shortly and I’m not subscribing to its pension scheme. My pension from my old job is now worth about £26,000 and I have requested a retirement quotation from the provider. I hope to receive a cash lump sum and a small monthly pension. Am I entitled to do so despite being only 57? I have been provided with some figures for a lump sum and annuity, which are reasonable, but I am worried in case I am not allowed to do so while still in part-time work.


There is now no set retirement age for anyone in employment. Legislation enables you to continue working well past the state retirement age. This gives you the flexibility to draw benefits from a pension scheme while remaining in work.

Normally, the minimum age when benefits can be taken is 55, which for most people is at least 10 years before the state retirement age.

The retirement benefits you have accumulated with your previous employer will only provide a very modest pension.You have, however, the right to obtain up to 25% of the fund as a tax-free lump sum, with the balance providing an income normally through the purchase of an annuity.

It pays to shop around to obtain the best value for an annuity, as insurance companies offer very different rates. If you smoke, have in the past or currently experience poor health, are significantly overweight or drink heavily, you may benefit from an enhanced annuity to reflect the potential reduction in your life expectancy compared to the national average.

This could provide a significant boost to the income normally available from an annuity.

Once the annuity is purchased, an income will be provided for the remainder of your life, whether you are in work or not.

Find the best annuity rate for your circumstances