The Lifetime Allowance (LTA) has been abolished with effect from 6 April 2024. In its place HMRC have introduced two new allowances:
This page now contains limited historic lifetime allowance information, which may be useful if you have previously taken pension benefits from the scheme prior to 6 April 2024.
The lifetime allowance was introduced in April 2006, and the total capital value of all pension benefits* you held was measured against this. If the value of your pension benefits when you took them was more than the lifetime allowance, you will have had to pay tax on the excess benefits.
*This does not include any state retirement pension, pension credit or any partner's or dependant's pension you may be entitled to.
- Between 6 April 2006 and 5 April 2023 – the Lifetime allowance was set each year, and benefits in excess of the LTA were subject to a 25% tax charge if paid as a pension or a 55% tax charge if paid as a lump sum.
The table below shows old lifetime allowance rates to 05/04/2024 when abolished:
| Year | Total lifetime allowance |
|---|---|
| 2015/16 | £1.25 million |
| 2016/17 | £1.00 million |
| 2017/18 | £1.00 million |
| 2018/19 | £1.03 million |
| 2019/20 | £1.055 million |
| 2020/21 | £1.0731 million |
| 2021/22 | £1.0731 million |
| 2022/23 | £1.0731 million |
| 2023/24 | £1.0731 million |
- Between 6 April 2023 and 5 April 2024 – Specific LTA charges relating to excess benefits paid on or after 6 April 2023 were abolished. Instead, payments that incurred LTA charges were subject to tax at the individuals marginal rate income tax.