UK - Should withdrawals from money purchases be scheduled as crystallisations or planned withdrawals? 

This consideration is especially important if you plan to take a large lump sum withdrawal of cash from the crystallisation of a money purchase (in our UK release).

Pension Commencement Lump Sum (PCLS) withdrawals from money purchases are still best scheduled on the Pensions > Money Purchase or Defined Contribution screens. Whereas regularly scheduled incomes from pensions or even large one-off withdrawals made for special purchases or debt payoffs are best scheduled on the new Planned Withdrawals screen.

When scheduled as a general crystallisation strategy on the Money Purchase screen , the software will know to sweep any surplus lump sum from the crystallisation into the owner’s default cash account, if it isn’t scheduled to be transferred elsewhere.



Scheduling the crystallisation of money purchases

General crystallisation instructions for money purchases are still managed on the Money Purchase screen’s Crystallisation of Money Purchase panel.

To view the software’s default crystallisation settings for Money Purchases, open the Pensions > Money Purchase screen. 

Expand Withdrawals & Annuity and select Crystallisation of Money Purchase.



You might use this panel rarely now that regular withdrawals from money purchases are managed separately on the Planned Withdrawals screen. But the Crystallisation panel will continue to be useful if ever you need to set a special crystallisation strategy for a money purchase.

While the Crystallisation panel’s options remain largely unchanged, some subtle changes have been made to the way the crystallisation settings are managed.

Notice that there is no longer an “as needed” crystallisation option on the panel. As needed crystallisations remain the software’s default, but there is no longer any need to select it as a crystallisation option.

This crystallisation option has been removed because scheduling future withdrawals from a money purchase and allowing the software to take withdrawals from one automatically, as needed, are no longer mutually exclusive options. You can now schedule a planned income from the pension (on the new Planned Withdrawals screen) while additional withdrawals can be taken by the software whenever they are needed to help fulfil expenses.

Notice the “Apply Crystallisation Instructions” checkbox is now left unticked by default.


In the past, unticking this option would preserve the pension for inheritors. With no crystallisations applied, the pension would be ringfenced, at least until it was passed to an inheritor. Now if you want to preserve a pension, this is easily managed using options on the new Withdrawal Limit panel. More about withdrawal limits can be found here.

Ticking “Apply Crystallisation Instructions” now activates the special crystallisation options below it.  


Scheduling a Pension Commencement Lump Sum (PCLS)

In most cases you will no longer need to tick the “Apply Crystallisation Instructions” option and enter crystallisation instructions.

But let’s say your client has a broad crystallisation strategy in mind. He plans to crystallise 100% of his pension at retirement, taking out the 25% tax-free cash allowance and moving the remaining 75% into a drawdown pension. General crystallisation instructions like these will still be set on the Money Purchase screen’s Crystallisation panel.

To schedule this onetime crystallisation, open the panel and tick the “Apply Crystallisation Instructions” checkbox.

Select form the drop-down list the event at which the crystallisation is to occur.  The default will in most cases be your client’s Retirement event, but alternative events could be added to the timeline and selected to schedule the crystallisation.  

Lump Sum: Either simply select the “Tax Free Cash Only” option or select “% of Crystallised Amount” and enter 25%.

Frequency: Select “One time”.

Finish by clicking OK to commit the changes.


According to these instructions, the software will crystallise 100% of the pension when its owner retires. The 25% tax-free cash allowance will be paid to the client as a lump sum while the remaining 75% of the pension’s balanced will be transferred into a drawdown account.

The tax-free lump sum, if it is not spent or transferred into a specific account, will be deposited into the owner’s default cash account (e.g. John’s Cash). Default cash accounts are always the software’s first stop for future top-up income.

The remaining 75% of the pension balance will be deposited into a drawdown account, which will be available for withdrawals as needed. The option is now available to also schedule a regular income from the drawdown pension on the new Planned Withdrawals screen.

Note - Drawdown accounts are created automatically by the software and are managed on the Pensions > Drawdown Pensions screen. More about drawdown pensions in a moment.

Phased crystallisations of various sorts can still be scheduled on the Crystallisations panel. More information about these options can be found here. Plus, any crystallisation instructions that you already have in place will continue to work as before and will still be available on the Crystallisation panel.

The Crystallisation panel is still a useful tool, but now only for setting general crystallisation instructions. When it comes to scheduling a regular income from a pension (e.g. an income of 15,000 per annum from his pension and hers), this is now best managed on the new Planned Withdrawals screen. There is no longer any need to finesse general crystallisation instructions in order to schedule an income from a money purchase.


Related Topics

New in Our December 2018 Release - The Planned Withdrawals Screen

About the Planned Withdrawals screen (how to schedule planned withdrawals)

Scheduling planned withdrawals from pensions

Withdrawal Limits – Placing restrictions on the software’s ability to liquidate assets as needed

Surplus Withdrawals - What happens to the surplus if I withdraw more than my client needs?

Withdrawal Limits on Money Purchases and Drawdown Pensions