Policy paper

Abolition of the Lifetime Allowance from 6 April 2024

This tax information and impact note is about abolishing the Lifetime Allowance (LTA).

From:
HM Revenue & Customs
Published
22 November 2023

Documents

Abolition of the Lifetime Allowance (LTA)

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Details

At Spring Budget 2023 the government announced that it would abolish the Lifetime Allowance (LTA). Finance (No.2) Act 2023 began this work by removing the LTA charge and delivering some changes to support the removal of the charge.

This measure delivers the changes required to abolish the LTA entirely and clarifies the tax treatment of pension savings.

It clarifies:

  • how lump sums and lump sum death benefits will be taxed in its absence
  • the position of individuals with LTA protections
  • lump sum protections or LTA enhancement factors
  • the function of Benefit Crystallisation Events
  • the tax treatment of transfers to qualifying recognised overseas pension scheme (QROPS) and sets out all necessary transitional arrangements and reporting requirements
Published 22 November 2023

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