Raising the Normal Minimum Pension Age from 55 to 57

  • Author : Novia Financial
  • Date : 8 Mar 2021

The government’s recent consultation proposes a change to the Normal Minimum Pension Age (NMPA) from April 2028. The publication has raised some questions about the proposed protection regime. The paper proposes that members of pension schemes who are currently able to retire at age 55 will have their minimum pension age protected. Our interpretation based on the consultation is that the Novia SIPP will be a protected scheme, meaning that all members of the Novia SIPP as at 11th February 2021 (the date the consultation was published) will retain indefinitely their ability to take benefits from the scheme at age 55.

Clients who will turn 55 before April 2028 will be able to take benefits at 55 regardless of the rule change. What remains unclear is the impact on younger clients who transfer their pensions after 11th February 2021. The consultation suggests that the existing block transfer provisions could be utilised to preserve protection, modified for greater flexibility in light of pension freedoms (for example, the benefits will not have to be taken all at once).

The amendment to the NMPA is only in its consultation phase, so it’s not clear what the final outcome will be. We have outlined some features of block transfers that you may find useful.

What is a block transfer?

Sometimes referred to as a ‘buddy’ transfer, it’s where 2 or more people transfer their whole pension from one scheme to another, at the same time. Under these circumstances, a protected pension age (and/or any protected lump sum entitlement) can be carried intact from scheme to scheme.

Will my client get a protection certificate?

No. Unlike lifetime allowance protection, a protected retirement age is specific to the scheme rather than the individual, so there are no certificates issued by HMRC. A client’s protected pension age is confirmed across a block transfer by the ceding scheme directly to the receiving scheme.

Do the individuals in the block transfer need to be related?

No. In fact there doesn’t need to be any connection between them at all. The clients just need to be members of the same pension scheme, transferring to the same pension scheme, at the same time.

What does ‘at the same time’ actually mean, and are there any other conditions?
The rules recognise that for any number of practical reasons, the money from both transfers may arrive at the receiving scheme on different days. What qualifies a block transfer is that the instruction is for both transfers to be processed under a single transaction. If the transfer instructions are explicit and reference all parties to the block transfer, the ceding scheme should be able to process both transfers as part of the same instruction and the ‘single transaction’ requirement for a block transfer will be met. For further requirements see here.

Can a block transfer be in-specie?


What’s the process for doing a block transfer into the Novia SIPP?

There is a block transfer button available at application stage, which prompts further details. Using this means that the Transfer/Re-registration Authority form will carry block transfer information. You should also use the notes section of the form to identify the other party(ies) involved in the block transfer.

Related reading

Guest Spot: With Profits: A New Fund in Town

As announced in recent weeks in previous Novia IQ posts, Wesleyan’s With Profits Fund, which recently moved to sustainable principles (as announced here), is now available on the Novia Platform….

Read more >

Guest Spot: Exploding retirement income myths #5

We live in an era dominated by soundbites and snappy slogans. From the world of advertising “Just do it”, “every little helps”, and “I’m loving it”, are very memorable examples. They’re written by ad agency professionals whose job is to write copy in soundbites that connect emotionally with us in order to influence where we spend our hard earned cash.

Read more >


Novia reports strong growth in 2021

28 June 2022

Novia Financial, which was acquired by private equity firm AnaCap in April last year, is thriving under its new owners with new leadership and promises continued focus on market-leading service…

Read more >


Guest Spot: Inflation and market volatility: where do investors go from here?

1 July 2022

Recent global and domestic events will have made many investors nervous. The UK economy is being buffeted by rampant inflation, with households seeing the largest rise in prices in more than…

Read more >

In the Media

Ask yourself tough questions if selling your business – Keith Furniss

6 May 2021

But before you jump, you really need to ask yourself rigorously: ‘What exactly do I want to achieve?’ This will be a new experience to you and probably the biggest financial…

Read more >


Novia User Update – Our latest enhancement to our Guaranteed Income solution

11 May 2021

For our latest enhancement, Implementation Executive Mark Wedge gives the latest User Update for Novia’s Guaranteed Income solution…