How to Sell Your Annuity

Annuity rules will change in 2017. You may then be able to sell an annuity. Under current rules, once you’ve bought an annuity you can’t change the decision.

If you want to sell your annuity you’d need to shop around with other providers to see which offers the best value.

You can use a broker or independent financial adviser to help you if you aren’t confident shopping around, but they may charge you.

Before you sell

You’ll need to check if you can sell your annuity.

You should also consider getting financial advice before selling.

Legally you must get advice if your annuity pays over a certain amount a year. This amount will be set when the new rules come in.

An annuity provides a guaranteed income for a fixed number of years or the rest of your life. If you already have one, you may decide the best option is to keep it.

How much you’ll get

How much money you’ll get from selling an annuity is likely to be based, for example, on:

your age
the type of annuity, eg single life, joint life
your health and lifestyle
how much you currently receive from your annuity
Before a provider can tell you how much you’ll get for your annuity, they may ask for a medical report from your GP or an independent doctor. How long you’re likely to live will affect the value of your annuity.

How you can use the money
When you sell your annuity you can take the money as a cash lump sum.

You could also use the money from the sale to:

buy a different type of annuity
get an adjustable income
Tax if you take cash
Your annuity provider will take off the tax you owe before they pay you the cash.

The cash you take will be added to any other income you have over the tax year, eg money from work, savings and benefits.

You may pay emergency tax which you can claim back from HM Revenue and Customs.

Benefits
Getting a large sum of cash from selling your annuity could affect your entitlement to any benefits.

If you deliberately spend or give away money from selling your annuity to get or increase help with care costs, your local council may assess your eligibility again and treat you as still having that money.