At long last, one of the life companies has released a product taking into account pension changes introduced in the 1999 Finance Act. Canada Life claims it has beaten the competition to launch the long-awaited Approved Retirement Fund (ARF) and Approved Minimum Retirement Fund (AMRF).

"We are delighted to be the first financial services provider to implement the recent Finance Act changes. Canada Life now has the vehicle to allow people at retirement to retain control of their pension fund," said Mr Brendan Kennedy, Canada Life's business manager for pensions.

The Canada Life product allows investors to choose a range of products from with profits bonds to a Pacific equity fund.

Under the Finance Act, 25 per cent of an accumulated pension fund may be taken tax-free for whatever purpose the fund-holder chooses. The remaining 75 per cent may be used in one of three ways: as a lump sum (subject to some restrictions); to purchase an annuity which provides guaranteed regular income for life; or to invest and then make withdrawals when you choose. The third choice is also subject to some restrictions.

Those with a guaranteed pension of less than £10,000 per annum are required to invest £50,000 in an AMRF or an annuity. The remainder may be taken as a lump sum.

If the guaranteed pension is more than £10,000 per annum then some or all of the accumulated pension fund may be placed in an ARF. If you have invested at least £50,000 in an AMRF or bought an annuity then any surplus may be invested in an ARF.

All withdrawals of capital from these funds are subject to income tax but withdrawals of investment growth are subject to no further tax.

The Canada Life product is available through its professional sales consultants and more than 1,500 independent brokers statewide.