Abolishing the pensions lifetime allowance
This measure delivers the changes necessary to abolish the pensions lifetime allowance from the tax year 2024 to 2025 onwards, as announced at Spring Budget 2023.
- Policy Paper Abolition of the Lifetime Allowance
- Bill Amendment Draft legislation (accessible version)
- Explanatory Note Explanatory note (accessible version)
This measure applies to all members of registered pension schemes. From 6 April 2024, it abolishes the lifetime allowance from pension tax legislation. It therefore limits the total amount of tax-free cash an individual can receive to a maximum of £268,275, unless they hold a valid lifetime allowance or lump sum protection.
It also limits the total amount of lump sums an individual can receive before marginal rate taxation applies to £1,073,100, unless they hold a valid lifetime allowance protection. The measure ensures that receipt of regular pension income does not contribute towards either of these limits.