With pension drawdown, also known as flexible retirement income, your money remains invested and you can draw a taxable income from your pension pot as and when you choose. However, unlike a lifetime annuity, the income is not guaranteed for the rest of your life. How long the money lasts for will depend on how much is taken as an income and where the money is invested.
You can continue to pay into your pension even after you start to draw from it. However, to prevent “pension income recycling” (double tax relief) the amount you can pay into your pension each year and receive tax relief decreases to £4,000. This is called the money purchase annual allowance (MPAA).