I've found myself in an odd situation which no-one seems to be able to give a straight answer on. I've googled endlessly and found no similar cases. I'm sure my situation can't be unique but maybe it is. I was made bankrupt in 1998 and as a result the forfeiture clause in my personal pension with Prudential (originally Scottish Amicable) kicked in. This just meant that they would hold my pension in trust while it carried on building as before. The only difference being that on redemption any lump sum would have to be paid to someone else. Now I want to take advantage of the new rules by taking small amounts as and when but the Pru are adamant I can only buy an annuity or have the whole amount paid out to someone else. They say they cannot transfer the pension to another provider and cannot pay it in installments, drawdown fashion. The problem with this is: The pot isn't big enough to make an annuity worthwhile. They say that payment of a lump sum will not qualify for any tax free element per the new rules. I have letters from both the OR and the TIB confirming they have no further interest in my pension and I am free to do as I please. The fund is worth about 80k. I am dealing with an independent financial advisor and he has been tearing his hair out from talking with the Pru. He feels the next step is to go to the ombudsman. I've dealt with ombudsman services before and know how long it can take. My question is basically are the Pru just being awkward or should it be possible to reinstate my pension and thus benefit from the recent changes in law, without having to lose half of the pot in tax? Will going to the ombudsman be likely to produce a result? I would be really grateful to hear from someone who knows about this subject.