The change in rules around using part of our pension pots to pay for tax-free financial advice could lead to some unscrupulous firms trying to con people into paying for consultations that are just guidance, a pension company has warned.

From April, a new law comes in that allows you to withdraw up to £1,500 tax-free from your pension pot in order to pay for financial advice.

The People’s Pension is urging the government to act to prevent companies from being able to approach people and encourage them to access their Pension Advice Allowance. The firm wants it to be mandatory that savers consult the government’s pension advice service before they can withdraw any money.

“Our view is that individuals should only be able to access money for that purpose after a mandatory engagement with SFGB [the as-yet-unnamed new government pensions advice service] and where the latter recommend that access should occur,” The People’s Pension have stated in a submission to the government’s consultation on the single financial guidance body.

The concern is that if people can freely access the money then companies could offer 'advice' via unqualified individuals.

What’s the difference between guidance and advice?

Giving out financial guidance means simply providing general information to help people understand financial products and terms. It is available for free online, and will be offered by the government’s new pension service.

Financial advice – which the allowance is meant for – involves a private consultation with a qualified adviser that looks at your situation and your financial aims and results in a personalised plan.

The Pension Advice Allowance will allow you to withdraw up to £500 from your pension pot three times, but not more than once a year.

It’s hoped that the allowance will help people get past the initial cost barrier and seek out professional financial advice at several different stages in their life.

“Pensions and savings decisions are some of the most important a person will make during their lifetime. This allowance will help people get the vital financial help they need to plan for their retirement,” said economic secretary to the Treasury Simon Kirby, when the allowance was first announced.

[Read more: Pension freedoms: how to ensure you pay less tax]