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Income drawdown

Our range of income drawdown options is available through Pension Portfolio on the Aviva Platform. Pension Portfolio offers flexi-access drawdown on a single or phased basis and gives your clients complete flexibility with their pension fund in retirement.

Pension Portfolio offers income drawdown options that work for your clients - whether they require light touch tax planning or a more hands-on approach.

Available options

  • Phased flexi-access drawdown
  • Single flexi-access drawdown
  • Capped drawdown (for clients already in capped drawdown prior to 6 April 2015 only)
  • Unfortunately, clients are not able to designate uncrystalised funds for capped drawdown into arrangements created to receive a transfer.

The Money Purchase Annual Allowance will apply as soon as clients take taxable income through flexi-access drawdown.

Phased drawdown options

Phased drawdown categories Flexi-access Capped How it works
Self-Select Income Y N Uses your client's tax-free cash to generate their chosen income. You can specify a gross amount of taxable income (0-75%) to be paid at the same time as each full 25% PCLS payment. You can tailor the taxable income level to keep within a tax band for example.
Non Taxable Income N Y Tax-free income provided from PCLS only, this will allow the client to keep the full annual allowance
Target Income Y Y Minimises crystallisations to protect PCLS growth. We'll only crystallise when there isn't enough money in the post-retirement account to pay the taxable income. We automatically calculate the minimum crystallisation needed to pay your client's chosen income amount. Their target income will include their tax-free cash, if any.
Taxable Income Y Y Minimises crystallisations to protect PCLS growth. We'll only crystallise when there isn't enough money in the post-retirement account to pay the taxable income. We automatically calculate the minimum crystallisation needed to pay your client's chosen income amount.  While PCLS is still paid, your client's tax-free cash is not included as part of their chosen income.

Single drawdown

Single drawdown  How it works 
Single drawdown Can be a suitable option where client needs a tax-free lump sum at the outset. They can crystallise the whole fund and take 25% as tax free cash. Otherwise, if the client doesn’t need all of the tax-free cash immediately then they can crystallise just part of the fund. 25% of the crystallised amount is paid as tax-free cash, and the remaining 75% is moved to the post-retirement account. Taxable regular income payments or lump sums can be paid from the post-retirement account. Any withdrawals will be taxed at the client’s marginal rate of tax.

The value of investments can go down as well as up and investors may not get back what they put in. Tax rules may change in the future.

Drawdown restrictions

Drawdown restrictions

Flexi-access drawdown
Minimum client age 55
Minimum investment amount -
Minimum amount clients must move to a post-retirement account for single drawdown -
Ad hoc withdrawals Yes, via the ad hoc withdrawal route on a gross basis
Payment frequency Monthly, quarterly, half-yearly or yearly

Existing capped drawdown clients

Capped drawdown is no longer available for new clients. But if they were in capped drawdown before 6 April 2015 then they can transfer into a new capped drawdown arrangement on the Aviva Pension portfolio and still stay in it and designate additional funds as required as long as they don't exceed GAD limits. If clients go over these limits, they'll automatically move into flexi-access drawdown which will trigger the money purchase annual allowance of £4,000.  We can accept transfers of capped drawdown, but unfortunately we can't facilitate additional fund designation into arrangements created to receive such transfers.

What's a pre-retirement account?

A pre-retirement account holds clients' uncrystallised funds.

What's a post-retirement account?

A post-retirement account holds clients' crystallised funds.

We use this money to pay clients' income, so we have to crystallise enough funds into this account to meet clients' income needs.

Income drawdown isn't suitable for everyone. There are risks and benefits which your client will need to consider. Clients will depend on you to adjust their income/tax position.


  • It’s completely flexible. Clients can carry on working and use variable income drawdown to top up their income if, say, their hours drop or there's a need for more funds
  • Flexi-access drawdown clients can take any amount out of their pension fund, whenever they wish - even all of it
  • Clients can choose not to take an income at all
  • The Target Income option lets clients use a combination of tax-free and taxable cash, making their income tax-efficient.
  • Clients can choose from a selection of investment options
  • Clients aren't locked in for life, so they can switch to another retirement income option (such as an annuity)
  • Clients can choose to leave their remaining pension fund (crystallised or uncrystallised) to any named beneficiary. If the client dies on or after their 75th birthday the beneficiary may have to pay tax on it
  • We can normally pay death benefits for clients who die before age 75 without any tax charges
  • Existing capped income drawdown clients have some control over the amount of income they take (subject to GAD limits).


  • The value of clients’ pension funds can go down as well as up, and may fall to less than the amount they paid in
  • Clients who select their income amount with the Target Income option may not receive the income they requested and their payments can vary from month to month
  • Investments must grow, if they're going to compensate for the income withdrawn. If that doesn't happen, the pension fund will be depleted – especially if the client takes a high level of income. There's a risk a client could run out of money
  • Taking income from flexi-access drawdown will trigger the £4,000 money purchase annual allowance
  • There’s no guarantee that annuity rates will improve in the future. They may fall, which means there's a risk of lower income if your client is using the product to delay buying an annuity
  • If your client is still in capped drawdown, they will continue to need GAD reviews every three years up to age 75 and every year afterwards
  • A small number of clients may need to complete a tax return to reclaim overpaid tax.
  • The remaining fund will continue to be charged.

Passing on drawdown pension funds

Your clients will be able to nominate who they would like to receive their drawdown pension funds on their death. We will take those nominations into account when deciding who should receive death benefits. The chosen beneficiaries will then normally be able to choose whether they would like an income or a lump sum. If they leave any money within the pension on their death, that can be passed on to their beneficiaries and so on

For a client who dies aged 75 or over, the beneficiary will pay tax on any benefits taken from the funds at their marginal rate.

For a client who dies before age 75, benefits can normally be passed onto their beneficiary tax free.

You can also use Pension Portfolio to administer any funds your client may inherit themselves.

Get more from the Aviva Platform

We’ve designed the Aviva Platform to be easy and straightforward to use. To help you get the most out of the Aviva Platform, we have a range of support available:

  • Regionally based wealth development managers providing face to face and telephone support to help you use the platform for your day-to-day business. Our team consists of experienced, diploma qualified consultants who have attained the high standard set by Aviva for account management (0800 092 9365, Mon-Fri 8:30-17:30)
  • Dedicated platform service and support teams (0800 056 4607, Mon-Fri 8:30-17:30)
  • A guide to everything you need to know about the Aviva Platform and due diligence
  • Step-by-step 'how to' guides to help you use and work with the platform
  • Online product literature and sales support from the Aviva for Advisers library
  • Demos to help you navigate, manage and transact business on our platform.

Adopting the Aviva Platform for your business

Our platform adoption and development team can help set up the Aviva Platform and turn it into an essential part of your business. We offer:

  • a demonstration of how to use the platform functionality
  • user guides so you can learn at your own pace
  • access to reference material
  • an online document library with a host of documentation on our products
  • a fund centre with information on all our funds, including fund group profiles,
    performance data, portfolio functionality and income analysis.

Get a free demonstration of the Aviva Platform

Contact us to arrange an appointment with one of our consultants:
0800 056 2026, Mon-Fri 8:30-17:30

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WA05097 02/2019