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Normal minimum pension age to rise to 57

In July, HMRC published a consultation on draft legislation to increase the normal minimum pension age from 55 to 57 in April 2028.

The normal minimum pension age (NMPA) is the earliest age at which most pension savers can access their pensions without incurring an unauthorised payments tax charge - unless they are retiring due to ill health.

Protected pension age and ‘new PPA’

NMPA has been 55 since 6 April 2010, unless a member has a protected pension age (PPA) which allows them to take their pension benefits between 50 and 55.

To reflect the increase in NMPA, protection known as ‘new PPA’ will be available. This will allow members to keep a NMPA of 55.

The new PPA will apply to members of schemes with rules giving the right to take pension benefits before age 57, including active members of the Railways Pension Scheme, if they were a member on 5 April 2023.

Will you be affected?

Only members who do not have a protected pension age and want to take their benefits before age 57, after 5 April 2028 will be affected.

Members who already have a PPA of 50 will not be affected by this new PPA or the increase in the NMPA.

The draft legislation is still under consultation until 14 September 2021 and therefore is subject to change.