What happens if I really need my money? A pension scheme is a retirement account for long-term investments, not a current or savings account. If you withdraw money before you’re 55 years old, you will incur the severe penalty of being taxed up to 55% on the sum you withdraw. This punishment is intentional: this money is for your retirement, not for your yoga trip to Tulum. That said, HMRC makes a limited allowance for withdrawal before age 55 if, for example, you are in ill-health. If you have been given less than a year to live, you could be permitted to withdraw 100% of your pension.
