Good News For Ladies: Maximum Income.



Posted on: 18th December 2012

The outcome of the Test-Achats case at the European Court in March 2011 means that the factors used to calculate maximum income for pension drawdown will become the same for men and women from 21 December 2012.

Under the current factors (called GAD (Government Actuary’s Department) Rates), men can draw more income than women each month because they typically have a shorter lifespan.

From 21 December 2012, women will be subject to the current male rates which will result in a higher maximum income for women who either start income drawdown after 21 December 2012 or have their pensions reviewed after that date.


A woman aged 60 commencing capped drawdown with a fund of £200,000, assuming her tax free lump sum has already been paid and 15 year gilt yields are 2.39%, (the October 2012 rate)

  GAD Rate (per £1,000 fund) Annual Pension Income
Pre 21st December 2012 4.5 £9,000
Post 21st December 2012 4.8 £9,600