AXA Wealth is introducing a flexible drawdown option for eligible members of its family SIPP; the AXA Wealth Family Suntrust (‘FST').
From 4 July 2011 this option follows changes to drawdown rules announced in April this year, which gave investors greater independence and flexibility for drawing income in retirement.
AXA Wealth FST was launched in 2009 to offer a number of investment options and retirement solutions to groups of people who want to invest together. The members of an AXA Wealth FST scheme invest together through a pooled fund which is managed as one portfolio.
Prior to the introduction of flexible drawdown, pension income withdrawals were capped based on the age of the saver and GAD limits. Flexible drawdown offers eligible individuals greater access to their pension pots and allows real independence - unlimited withdrawal from a pension fund for those members who meet the qualifying conditions.
Under AXA Wealth Family Suntrust flexible drawdown is typically available to members if:
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they are aged over 55
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they have a minimum fund size of £50,000* available for retirement benefits
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they satisfy the minimum income requirement at the relevant date
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no contributions are paid to any money purchase schemes by or on their behalf in the tax year in which the declaration is made for flexible drawdown
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at the time of the declaration for flexible drawdown, the individual is not an active member of a defined benefit or cash balance scheme.
Mike Morrison, head of pensions development, AXA Wealth, said: "This year, Independence Day has a whole new meaning at AXA Wealth. In the past HMRC has been insistent that tax relief is given to pension schemes on the basis that the accrued fund is used to provide a lifetime income. The introduction of flexible drawdown is a real step forward for those who can fulfil the minimum income requirement.
"Flexible drawdown opens the door to real flexible income and tax planning particularly when used in conjunction with other tax efficient investments. This could be the product that high net worth investors have been waiting for - giving adviser's the ability to look at all of a client's investments and to design an income and investment strategy across the whole retirement portfolio."
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