Almost 300 people fully encashed a pension of more than £250,000 after tax-free cash between October 2023 and March 2024, paying a minimum £98,700 each in tax in the process, according to new analysis of FCA figures by Standard Life.

Charging inheritance tax on unused pension funds will create confusion and increase the risk of gifting mistakes for the Bank of Mum and Dad and Gran and Grandad, equity release specialist Key Advice has warned.

Pension providers have been urged to find out more about post-retirement spending as new research suggests homeowners’ and renters’ drawdown habits are very different.