Pension recycling: How not to fall foul of tricky tax rules

Looking to maximise your pension and save on taxes? Pension recycling might be the strategy you're seeking. But beware - this tax-saving technique comes with strict rules that could cost you dearly if misunderstood.

What you need to know:

• Pension recycling involves withdrawing a tax-free lump sum and reinvesting for additional tax relief

• You can potentially boost your pension savings, but HMRC has set strict limits

• Breaking the rules could result in tax charges up to 55% of your tax-free lump sum

• Key factors include the amount withdrawn, increased contributions, and HMRC's assessment of your intentions

Intrigued by the potential benefits but wary of the risks? Pension recycling requires careful planning and expert guidance. Read on to discover how to navigate this complex strategy and whether it's the right move for your retirement savings.