What is a pension annuity?
A pension annuity is a bit like having a salary after you retire. It's a product that takes your pension pot and turns it into a guaranteed income for the rest of your life. You'll be paid regularly and you'll pay income tax on the money you receive.
There are no hidden charges or unwanted surprises as we allow for all fees when we calculate your income.
Because it's guaranteed, you can make plans for retirement, knowing you'll always have this income. No fear of the pot running dry.
Different annuity providers offer different rates and options. Shopping around can help you find the annuity best suited to your circumstances, or the one that will pay you the highest income.
The benefits of a pension annuity
If you’re 55 or over, you can use some – or all - of the money in your pension plan to buy an annuity. That’s going up to 57 and over from 6 April 2028, unless you have a protected pension age.
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Get paid your way
We can often fix your income for the rest of your life, increase your payments at a fixed rate each year, or increase your payments in line with the Retail Price Index. It’s your call.
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Take care of your people
Take care of a partner, a child under 23, or someone who’s dependent on you because of their disabilities – we can pay up to 100% of your guaranteed income to them if you pass away.
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Secure more than a life-long income
You can set your income to be paid for a minimum of between 1 and 30 years from the start of your annuity, even if you pass away. We offer value protection as standard for 90 days from your plan start date. If you die within this period, it pays a lump sum if there are no annuity payments continuing to a dependant.
The different options you select will have an impact on the income you receive. Once your annuity has been set up, you can't make any changes to it or cash it in.
Up to 25% of your pension tax-free
You can take up to 25% of your pension in tax-free cash before you buy your annuity. If you’re with another provider, you’ll need at least £10,000 left in your pension after withdrawing and paying any adviser fees. If your pension is with Aviva, there’s no minimum. Taking tax free cash will result in a lower level of income.
No surprise fees or charges
We allow for all fees when we calculate your income – so there are no hidden charges or unwanted surprises.
Remember
Depending on how long your retirement is, and the options you build into your annuity, you may receive less in payments than the amount you paid for the annuity.
Tax benefits are subject to change and depend on your individual circumstances.
Pension annuities explained
Watch our video to find out what an annuity is, and if it could be right for you in retirement.
Try our annuity calculator
Annuity Calculator
Get an idea of what your guaranteed life-long annuity income could be by having a whirl on our annuity calculator. It’s a piece of cake to use and only takes a couple of minutes – less than the time it takes to eat an actual piece of cake.
How we calculate your annuity income
Lots of things go into working out your annuity income, like the size of your pension, the benefits you want from your annuity, your age, and your health. It’s important that you’re as upfront and clear about your medical history as possible, and providing us with detailed information like medical letters or hospital reports can lead to a larger annuity income.
You can take a deep dive into how we crunch the numbers by checking out our annuity rates explainer.
How to get started
Important documents
Before deciding whether to buy an annuity, make sure you’re up to speed with how it works and what options are available by reading our Key Features document and Shopping Around Guide.
Make the right choice for you
When choosing what path to take for your future, it can be useful to get some help reading the map. Our pension guidance could be just the thing to set you on course for your retirement goals. Or you could call in the experts and speak to an adviser from the Aviva Financial Advice Team. They can guide you on all your financial planning options. Any recommendations they make will be for products from Aviva and other carefully selected partners.
Pension Wise
If you’re 50 or over, you can get impartial and specialist advice on your retirement options using Pension Wise from MoneyHelper. It’s backed by the government and completely free.
Give them a ring on 0800 138 3944 or visit their website for more details.
Pension annuity FAQs
What happens to an annuity when you die?
How is an annuity taxed?
What’s a benefit crystallisation event?
How does an annuity work?
Can I sell an annuity?
Pension annuity articles
Take a look at our helpful articles.
Annuity vs drawdown – two ways to take your pension money
When approaching retirement one of your main decisions will be how to take money from your pension. Explore the differences between drawdown and an annuity here.
Enhanced annuity – What they are and how to get one?
An enhanced annuity could be a way to boost your retirement income, this article talks abut how you may be eligible for more than you think at retirement, and exactly how to check.
What is an annuity?
An annuity converts your savings or pension pot into a low risk guaranteed income for your retirement. See how annuities work, and if it could be right for you.
An overview of annuity rates
Annuities give you a guaranteed income for the rest of your life. But exactly how much could you get?
When do annuities make sense?
Annuities can provide a stable income for your retirement, but they aren’t the only option. Find out if they’re the right choice for you.
Get in touch
Reach out to us and have a chat with one of our annuity experts. They’ll answer all your questions and queries and help you find out how much your annuity income could be.
My pension's with Aviva
0800 096 5106
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My pension's with another provider
0800 051 4003
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Weekends and bank holidays: Closed
Aviva Life & Pensions UK Limited. Registered in England No. 3253947. Registered office: Aviva, Wellington Row, York, YO90 1WR. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Firm Reference Number: 185896.