The chancellor has promised a “big bang of reforms to unlock growth”

Keir Starmer’s Labour government was very quick to announce a “landmark pensions review” intended to “boost growth and make every part of Britain better off”. This review – coupled with the heavily publicised overspend of £22 billion – might mean that some money is clawed back via pensions.

Tax relief and the State Pension triple lock are two obvious areas where cuts and savings might be made. More surprisingly, another pension rule has come under threat.

Under current rules, when accessing your pension as an annuity, you are entitled to a 25% tax-free cash payment – a PCLS. Tax-free cash is also available on Pension Freedoms options, like drawdown.

Media speculation ahead of the Budget, though, suggests that this option, first introduced back in 2006, could be altered or removed.

But what would that mean for you?

With the Budget still a month away speculation is rife, but little concrete information is known.

The Autumn Budget will take place on 30 October and the first thing to remember is that media reports are, at this stage, mere speculation.

While some changes have already been made, and others will be leaked in the run-up to the big day, others will be surprise announcements. It’s also impossible to say when any changes that are announced will be implemented.

So what might change?

Some commentators are predicting changes to the PCLS, which applies when you take an annuity. You are entitled to up to 25% of your defined contribution pension pot as a one-off lump sum. Tax-free cash is also available on certain Pension Freedoms options.

One way a change might be implemented is to insist that individuals accessing their pension generate a minimum level of income, and only then take the remainder (up to 25%) as tax-free cash. This would help to ensure that pensioners have sufficient income to last for their retirement, but it would come at a cost of pensioner’s flexibility and choice.

Another option, suggested in some quarters, is for the chancellor to limit the amount of tax-free cash individuals can take, capping it at £100,000, say.

If your plan doesn’t involve retiring now, then you’ll need to think about the potential implications of retiring earlier than planned:

These are all important questions to think about and while we can help you to think about your options, there is no one-size-fits-all approach. Ultimately, we will all need to wait to see what the Budget brings.