The lifetime allowance was for the total amount of pension savings you could build up during your working life before you had to pay extra tax. It applied to the money in all your workplace pensions, including our Scheme, and any personal pensions you had – but not your State Pension.
The government abolished the lifetime allowance on 6 April 2024 and replaced it with two new allowances.
- The lump sum allowance. This is the maximum amount you can receive tax-free from all your pensions when you retire. The allowance is £268,275.
- The lump sum and death benefit allowance. This is the maximum amount that can be paid out tax-free from all your pensions when you die or suffer from serious ill health. The allowance is £1,073,100.
Your pension scheme will tell you when a tax-free payment uses up any of your allowances.