Abolition of Lifetime Allowance — amendment of power to make further regulations
Published 9 March 2026
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Who is likely to be affected
Individuals who receive lump sum payments or death benefits from registered pension schemes, relevant non-UK pension schemes, and certain foreign pension schemes.
Those individuals who have or intend to apply for Lifetime Allowance protections, lump sum protections, or Lifetime Allowance enhancement factors.
Individual members of relevant non-UK pension schemes and registered pension schemes who transfer their funds to a Qualifying Recognised Overseas Pension Scheme.
Scheme administrators of registered pension schemes and scheme managers of relevant non-UK pension schemes who will need to modify their processes to accommodate changes to the taxation of lump sums, lump sum death benefits, changes to Benefit Crystallisation Events, and to the taxation of overseas transfers.
General description of the measure
This measure updates the current power in paragraph 134 of Schedule 9 to the Finance Act 2024 to enable any new regulations made under that power to have effect from the 2024 to 2025 tax year. Any regulations made under the power will be subject to the affirmative parliamentary procedure. The measure also extends the expiration of the power to 30 June 2026. The existing power in paragraph 133 in respect of transitional issues remains subject to the conditions within paragraph 134 and any regulations made under this power in paragraph 133 will also be subject to the affirmative procedure.
Policy objective
This measure allows further regulations, in connection with the abolition of the Lifetime Allowance, to have retrospective effect to the tax year 2024 to 2025 (the tax year in which the Lifetime Allowance was abolished).
Background to the measure
The Lifetime Allowance was abolished from 6 April 2024. Further regulations are required to introduce technical amendments in connection with the abolition. The current power in paragraph 134 of Schedule 9 permits the making of regulations up to 5 April 2026 and limits any retrospective effect to the tax year in which the regulations are made. The current power would not therefore permit regulations laid in the 2025 to 2026 tax year to take effect for the 2024 to 2025 tax year, which is what is now required.
To allow sufficient time to introduce regulations, the duration of the power must be extended.
Detailed proposal
Operative date
This measure will have effect from the date of Royal Assent to Finance Bill 2025-26.
Current law
The current enabling power is set out in paragraph 134 of Schedule 9 to the Finance Act 2024.
Proposed revisions
The measure updates the existing power in paragraph 134 to make these provisions:
The power may be used to make provision taking effect from the time of the abolition.
The existing power in paragraph 133 in respect of transitional issues remains subject to the conditions within paragraph 134.
All future exercises of the power are subject to the affirmative parliamentary procedure.
Postponement of the date on which it expires.
Summary of impacts
Exchequer impact (£ million)
| 2025 to 2026 | 2026 to 2027 | 2027 to 2028 | 2028 to 2029 | 2029 to 2030 | 2030 to 2031 |
|---|---|---|---|---|---|
| — | — | — | — | — | — |
This measure is not expected to have an Exchequer impact.
Economic impact
This measure is not expected to have any significant macroeconomic impacts.
Impact on individuals, households and families
This measure is not expected to have any impacts on individuals, households and families.
Equalities impacts
This measure is not expected to have any impacts on groups sharing protected characteristics.
Administrative impact on business including civil society organisations
This measure is not expected to have any impacts on business including civil society organisations.
Other impacts
Other impacts have been considered, and none have been identified.
Monitoring and evaluation
This measure will be kept under review through communication with pension scheme administrators.
Further advice
If you have any questions about this change, please contact the Pension Policy team in HMRC at policypensions@hmrc.gov.uk.