Abolition of the lifetime allowance

The 6 April 2024 saw the removal of the lifetime allowance from pensions tax legislation. Uncover the changes in our articles, covering topics including the three new allowances, transitional arrangements and the abolition of the lifetime allowance.

The information on this page is based on our understanding of taxation law and HMRC practice as at 6 April 2024, which may change.

Read each article in the series

Return to this page and complete the questions below to download your CPD certificate. You don’t need to read all the articles in one go – just pick up where you left off.

Learning objectives

Understand the technical aspects of the changes in force since 6 April 2024.
Be able to explain how the three new allowances work.
Understand how lifetime allowance protections affect the new lump sum allowance and lump sum and death benefit allowance.
Build an understanding of the wide range of advice opportunities and issues related to the changes.

Test your knowledge

Once you’ve watched the webinar, enter your name and correctly answer the questions below to generate your CPD certificate.

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Question 1: What are the three new allowances called?

The lump sum allowance, the death benefit allowance, the gone away transfer allowance

The lump sum allowance, the lump sum and the death benefit allowance, the overseas transfer allowance

The lump sum and death benefit allowance, the inheritance allowance, the overseas transfer allowance

Question 2: If any benefits that exceed an individual’s lump sum and death benefit allowance are taken, at what rate will they be taxed?

Marginal rate

Higher rate

Basic rate

Question 3: From 6 April 2024, what are the two additional reasons that a 25% overseas transfer charge may be payable?

None of the exclusions apply and the individual is resident in the same country as the QROPS was established

They’ve transferred to a QROPS and because the transfer exceeds the individual’s remaining overseas transfer allowance

Because the transfer exceeds the individual’s remaining overseas transfer allowance and none of the exclusions apply

Question 4: If a scheme receives an application for a transitional tax-free amount certificate (TTFAC) and misses the three month deadline to issue, or refuse it, what are the potential consequences?

HMRC can impose a £300 penalty on the scheme administrator plus an additional £60 for each day’s delay after the £300 penalty has been imposed

£300 penalty payable by the client

You can’t apply for a TTFAC for a year after and HMRC can impose a £300 penalty

Continuous Professional Development

Completed on:

CPD credit: 60 CPD mins

The User

Completed on: 20 July 2023
CPD credit: 60 CPD mins

CPD Learning covered

Understand the technical aspects of the changes in force since 6 April 2024.
Be able to explain how the three new allowances work.
Understand how lifetime allowance protections affect the new lump sum allowance and lump sum and death benefit allowance.
Build an understanding of the wide range of advice opportunities and issues related to the changes.

Article Abolition of the lifetime allowance

Learning objectives

Test your knowledge

Certificate of completion

The User

Abolition of the lifetime allowance

CPD Learning covered