Income drawdown
With income drawdown you take an income direct from your pension fund while still leaving it invested. The idea is that the investment growth will keep your fund healthy.
Income drawdown gives you greater flexibility over how much income to take. You can choose to take no income at all or up to 120% of your available annuity income. You can choose to stop drawing income at anytime and opt to purchase an annuity instead.
If you die during income drawdown your dependants can inherit the remaining fund. The remaining fund can be paid to them as an annuity or as income from the remaining fund, which is then taxed. It can also be taken as a cash lump sum but is then subject to 35% tax.
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