Almost three in five (59%) people are concerned about rumoured changes to pension tax-free cash rules in the upcoming Autumn Budget, Nucleus Financial Platforms has found.

The investment platform and wealthtech software group’s latest research comes as speculation circles around potential cuts to the amount of cash people can withdraw tax-free from their pension.

Nucleus revealed that this number of people worried about these rumours is more than double the number of those who are unconcerned by the speculation (28%).

Those aged 55 and above can normally withdraw up to 25% of the value of their pension tax-free, up to a maximum of £268,275. However, Nucleus stated that rumours suggest that this could be "significantly reduced" in the Budget on 26 November.

The firm’s latest research comes after the Financial Conduct Authority found that there was a 29% increase in people taking only tax-free cash from their pension during the last tax year, compared to 2023/24.

Nucleus added that this increase is likely to have been driven by last year's Budget speculation.

Technical director at Nucleus, Andrew Tully, said: "For the second year in a row the UK faces a lengthy run-up to the Autumn budget. This extended period allows the rumour mill to churn given the Government hasn’t clarified its position. Last year’s speculation of potential changes to tax-free rules saw many investors take lump sums from their pensions, with some trying to reverse those actions when no such rule change materialised. There’s a real sense of déjà vu here.

"Long-term planning needs certainty. Speculation can harm confidence and lead to potentially self-destructive behaviours. Ideally the Government will confirm there will be no change to tax-free cash, at least in this budget or for this Parliament, which will give people the ability to plan for their retirement with more confidence."

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