Uncrystallised funds pension lump sum

Usually abbreviated to UFPLS, an uncrystallised funds pension lump sum is a way of accessing your pension. You can take an UFPLS from any part of your pension you haven't accessed (known as your uncrystallised funds) from age 55 (rising to 57 from 6 April 2028).

Although you receive one lump sum payment, 25% of each UFPLS is tax-free, and the remaining 75% is subject to income tax. Until we receive a tax code from HMRC, we may need to apply an emergency 'Month 1' tax code – meaning HMRC will assume it's the first in a series of monthly withdrawals. This could mean you’ll pay more tax up front than you were expecting, though HMRC should refund any tax you overpay.

Once you take an UFPLS from your SIPP, the amount you can contribute to your SIPP (and any other money purchase pensions) will be restricted to £10,000 a year. This is known as the money purchase annual allowance (MPAA).

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Popular terms

Alternative Investment Market (AIM)

The junior marketplace of the London Stock Exchange, acting as a way for small and medium-sized growth companies to access investors. There are weaker regulatory requirements for companies that want to list on the AIM compared to the Main Market, which can mean less protection for investors.

AJ Bell offers dealing within the AIM market via our investment platform.

Aquis Stock Exchange

An alternative junior marketplace to the Alternative Investment Market (AIM), offering a place for small and typically less mature companies to trade their shares. This is separate to and not owned by the London Stock Exchange.

Companies listed on the Aquis Stock Exchange tend to be at a very early stage of development with low levels of liquidity and little or no trading history, making them harder to buy or sell – and therefore a riskier investment.

AJ Bell offers dealing within the Aquis Stock Exchange via our investment platform.

Bond

A type of investment in which you lend money to a company or government. In return you get interest payments and repayment of the money you lent at the end of a specific term. The interest rate and term are set at the start of the investment.

Investing in bonds is generally considered safer than shares. But there are still risks, primarily default risk (i.e. the company or government becoming insolvent), inflation risk, and the risk that interest rates rise over time.

A bond issued by the UK government is also known as a gilt. You can buy bonds directly, as well as invest in funds that hold bonds.

See our bond offering Read more about bonds