Pensions withdrawals soar but not the averages

Money withdrawn flexibly from pensions rose 15% in 2022-23 according to HMRC statistics. Some £12.9bn was taken up from £11.2bn a year earlier and £9.3bn a year before that. The total value of taxable payments withdrawn since flexibility changes were introduced in 2015 has exceeded £72.2bn.

Between 1 April and 30 June 2023 £4bn of taxable payments was withdrawn from pensions flexibly by 567 000 individuals across 1.3 million payments. The average taxable withdrawal per person was £7 143 in this period. This is higher than the average withdrawn in the same period a year earlier (£7 067) but down from £8 297 in 2019.

Sarah Coles head of personal finance at Hargreaves Lansdown said: ‘On first glance it looks like a 15% rise in the cash drawn from pensions as the cost-of-living crisis drives more emergency withdrawals.’

She added that it...