Pension Lifetime Allowance – What’s Changed?

Understanding the Latest Pension Rules

The Lifetime Allowance (LTA) was the total amount you could build up in your pension pot without facing an extra tax charge. However, this changed in April 2023, when the government removed the LTA tax charge. From April 2024, the LTA is set to be abolished completely.

So, what does this mean for you?

  • You can still take up to 25% of your pension as a tax-free lump sum —
  • But this is capped at £268,275, unless you hold LTA protection from earlier rules.
  • Any withdrawals above that are taxed as income under normal pension withdrawal rules.
  • There is no longer a 55% tax charge for exceeding the Lifetime Allowance.

This makes pension planning more flexible — but it also means professional advice is more important than ever, especially if your total pension savings are nearing or above previous LTA levels (just over £1 million).

Do You Have LTA Protection?

 

If you applied for Fixed or Individual Protection in previous tax years, your higher allowance and tax-free cash entitlement may still apply.
An adviser can check your protection status and help you avoid losing any valuable entitlements.

Need Help with Pension Limits?

Our FCA-authorised advisers can review your pension savings, tax-free cash entitlement, and retirement options — ensuring you’re making the most of the current rules.

Book a call today…

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Important Notice

If you think you may exceed the lifetime allowance threshold or you are not sure about your options it is important to get independent qualified advice as soon as possible so that you can mitigate the implications of the LTA (lifetime allowance).

How Much Is Your Pension Worth?

By allowing us to carry out a thorough pension assessment we can give you an accurate value of how much ALL your pensions are worth and if you exceed, or could exceed, the lifetime allowance threshold.

Improve Your Retirement Income?

By combining your pension funds and managing the funds they are in you can improve your overall retirement income potential.

By using our assessment service we will also provide you with options to improve the overall performance of your pension investments.

Calculate Your Lifetime Allowance

The pension Lifetime Allowance was reduced in 2016, you can apply to protect your lifetime allowance from this reduction. Calculate your lifetime allowance and see if you need to take advice to protect your pension.

Free lifetime allowance guide to download.