The total value of taxable pension withdrawals made under the UK's pension freedoms has exceeded £124.7bn since the reforms were introduced in 2015, with withdrawals continuing to accelerate during the 2025-26 tax year, the latest HMRC figures have revealed.

Taxable flexible pension withdrawals reached £22.4bn in 2025-26, up from £18.6bn in 2024-25 and £15.3bn in 2023-24, which is a result of a growing number of retirees accessing defined contribution pension savings, the government body said.

During the first quarter of 2026, covering January to March, 770,000 people withdrew £5.9bn across 1.9 million taxable payments, with the average withdrawal per person rising to £7,700. The value of withdrawals increased 18% year-on-year, while the number of individuals accessing their pensions rose 15%.

HMRC's data also showed that 42% of people who have made flexible taxable withdrawals since 2015 first accessed their pension between the ages of 55 and 59, while 27% first withdrew funds between 60 and 64 and 20% between 65 and 69.

However, the age profile of withdrawals has changed significantly over time. In 2025-26, people aged 65 and over accounted for 46% of the total value withdrawn, up from 29% in 2016-17, while the share withdrawn by those aged 55 to 59 fell to 23% from 42%.

Commenting on the figures, David Brooks, head of policy at Broadstone, said: "The continued growth in taxable pension withdrawals is to be expected given the growing number of people reaching retirement with defined contribution pension pots. However, the 18% annual increase in the value withdrawn during the first quarter of 2026 compared to the previous year is striking and suggests that financial pressures may be encouraging savers to access more of their pensions.

“The true concern is that we have little conclusive evidence to gauge how savers are accessing their pensions and whether they are doing so in a sustainable way. Pension freedoms provide valuable flexibility but inevitably increase the risk that savings are depleted too quickly, particularly where people underestimate how long their retirement may last.”

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