Immediate Life Annuity

An Immediate Life Annuity is a retirement income plan that can be bought with your own money from non-pension sources. It can be bought with savings, investments, inheritance or the tax free cash lump sum from a pension fund. This annuity can provide you with a tax efficient, additional income from the age of 55. It provides you with a guaranteed income for the rest of your life and can be seen as a low risk choice.

What are the benefits?

  • Guaranteed income. It promises to pay you a regular income for life, so it's a low risk option.
  • Income choice. You can receive your income monthly, quarterly, half-yearly or annually. Payments can be 'in advance' (from the start date), or 'in arrears' (at your chosen payment interval after the start date).
  • Tax Advantages. HM Revenue & Customs may agree that part of your payment is a return of capital and therefore not subject to tax. Any statements relating to tax are based on our understanding of current tax law, which may change in the future. Tax treatment will depend on your personal circumstances - a Financial Adviser will be able provide you with more information about your tax position.
  • No surprise charges. We take our charges into account when we work out the price of your initial annuity.

Things to think about

  • Depending on how long you live you may get back less than you bought your annuity for.
  • Our Immediate Life Annuity comes with a one year guarantee and value protection as standard. You can choose to extend your guarantee period along with other options.
  • No cash-in value. Once you've bought an annuity it cannot be cashed in at any time.
  • What happens to your annuity when you die?

    If you die within the first 90 days of the date your plan starts, and any dependant named on the policy dies before you, Value Protection will apply and a lump sum will be payable to your estate.

    If you die after 90 days but within your guarantee period, payments will continue until the end of the guarantee period. These will be paid to your estate or dependant on the policy.

    If you have chosen for an income to be paid to a dependant and they are still alive, agreed payments will be made to them.

    Please see your terms and conditions or contact your financial adviser for further information and exclusions which may apply to the above.

  • Changing your plan. The options you choose at the start of your plan can't be changed.

Your options

You can:

Next steps

Pension Wise

Pension Wise is a free and impartial service set up by the government for people retiring with defined contribution pensions. It will help you understand what your choices are and how they work.

You'll be able to get help on the Pension Wise website, over the phone or face to face about:

  • what you can do with your pension pot
  • the different pension types and how they work
  • tax you pay on your pension.

If you're not sure about your options at retirement you should seek appropriate guidance or advice.

Speak to a financial adviser

Nothing on this site is personalised advice or a recommendation. If you need a personalised recommendation based on your personal circumstances, you should seek financial advice. We can't give you advice but we can put you in touch with an adviser who can talk to you about which financial products or investments may be right for you.

Call a member of our team on

0800 533 5195

Monday to Friday - 9.00am - 5.00pm

For our joint protection, we may record our telephone calls. Calls are free from both land lines and mobile phones.

Alternatively, you can visit to find an adviser in your local area

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