The increase in the Normal Minimum Pension Age to 57 is approaching fast. In this article, Grant Blakey, Technical Team Leader at AJ Bell, sets out what paraplanners need to know and where uncertainty remains.
The increase in the Normal Minimum Pension Age (NMPA) from 55 to 57, effective from 6 April 2028, is no longer a distant regulatory footnote. For paraplanners, it represents a material shift that complicates retirement planning and pension transfer advice.
Although the broad framework for the change was established by the Finance Act 2022, key elements of the transitional arrangements remain unresolved.
As a result, paraplanners are required to work with a combination of legislation, HMRC commentary and informed assumption. Understanding both what is settled and what remains uncertain is essential when advising on timing and access.
Who is affected?
The NMPA will increase to 57 for most pension savers. Individuals born before 6 April 1971 will reach age 57 before the new rules take effect and are therefore unaffected.
At the other end of the spectrum, those born after 5 April 1973 will fall fully under the new regime, meaning their minimum pension access age will be 57 unless they hold a valid Protected Pension Age (PPA).
Between these groups sits the so-called “window cohort” which includes individuals born between 6 April 1971 and 5 April 1973. This group can reach age 55 before 6 April 2028 but will not yet be 57 when the new NMPA applies. Without protection, they face a potential cliff edge.
If benefits are not crystallised before the change, access to pension funds could be lost for a period until their 57th birthday. This makes retirement timing and early-access planning particularly sensitive for this cohort.
What we know
Retention of an NMPA of 55 or 56 depends on meeting two strict conditions.
First, the scheme rules in force on 11 February 2021 must have conferred an “unqualified right” to take benefits at 55 or, less likely, 56. In other words, the scheme rules specify the actual age rather than saying the member can take benefits at the NMPA. An “unqualified right” means the member could access benefits without requiring trustee or employer consent.
Second, the individual must have been a member of that scheme, or in the process of a substantive transfer to it, by 4 November 2021. Joining a qualifying scheme after this date does not grant protection for future contributions.
Transfers add an additional layer of complexity. Where an ‘individual transfer’ is made from a scheme with a PPA to a new arrangement, the transferred funds can retain their protected status, and the value must remain clearly identifiable and effectively ‘ring‑fenced’ within the receiving scheme.
Any existing funds in the receiving scheme, future contributions or subsequent transfers will generally be subject to the higher NMPA of 57.
However, it is also possible to preserve the PPA entitlement by making a ‘block transfer’. Provided at least two members transfer from the same scheme to the same receiving scheme (as part of a single transaction), the PPA can apply to all benefits in the new scheme, including existing funds and future accruals.
The unresolved areas
Despite the legislative framework, several practical questions remain unanswered. Namely, how the rules will apply to income already in payment. For example, a member in the window cohort who crystallises benefits at 55 and enters drawdown may still be only 56 on 6 April 2028.
The prevailing assumption is that income from existing drawdown funds should be able to continue, but that further crystallisations, particularly to generate new tax-free cash sums, may be blocked until age 57. HMRC has yet to confirm this explicitly.
Similarly, there is no definitive guidance on partial crystallisation. If only part of a pension is crystallised before the change, it remains unclear whether the remaining uncrystallised balance can be accessed during the intervening period between ages 55 and 57.
Operational uncertainty remains around evidencing protection. While the Association of British Insurers (ABI) is developing cross-industry data standards, there is currently no HMRC-mandated approach for how ceding schemes should document and report PPA ring-fencing to receiving providers.
In the absence of a mandated disclosure format, paraplanners should remain vigilant, as operational differences between providers may give rise to the risk of protections being unintentionally overlooked or even lost for all intents and purposes, even when advice and intent are sound.
HMRC indicated in a 2022 Pension Schemes Newsletter that transitional regulations are being developed to ensure the policy “works as intended”. Until HMRC confirms how the transitional arrangements will work, paraplanners should adopt a cautious, assumption-aware approach, particularly when modelling retirement around the 2027/28 tax year.
For clients, the choice to crystallise at 55 versus waiting may reflect policy timing rather than tax efficiency or investment return.
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