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06 July 2015

Changes to the Lifetime Allowance

The Lifetime Allowance is the total amount of pension savings you can build up across all of your registered pension schemes during your lifetime. Any savings that exceed the Lifetime Allowance will be taxed at a higher rate.
 
The 2015 Budget confirmed that the Lifetime Allowance will reduce from £1.25 million to £1 million from 6 April 2016. It will then increase in line with inflation from 2018 onwards. 
 
In April 2014, the Lifetime Allowance reduced from £1.5 million to £1.25 million, and the government offered some optional protections (Fixed Protection 2014 and Individual Protection 2014). We do not yet know what types of protections will be available for the 2016 reduction, but they may be similar to the 2014 protections.


 

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