Lifetime Allowance

What action can I take?

Fixed protection

1

If your combined funds are close to the Lifetime Limit of £1,073,100 you can apply for Fixed Protection. However, this is not available if you have made any contributions after 5th April 2016 and you must not make any contributions in the future.

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Individual protection

2

If your combined funds are valued at over £1,073,100 on 5th April 2016 you can apply for Individual Protection. This gives you a higher allowance of up to £1.25m equal to the value of your combined funds on the 5th April 2016. Contributions can continue.

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Reduce contributions

3

If you are projected to exceed the Lifetime Allowance in the future based on current contributions, you could reduce or stop employee contributions. (Check that this doesn't affect your entitlement to receive employer contributions)

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If all else fails...

4

If you are still projected to exceed the Lifetime Allowance on employer contributions alone, find out if your employer allows you to opt for cash in lieu of a reduced employer contribution. If you have the choice you may find it is a difficult one to make. As there will be a deduction to cover the additional cost of employer’s National Insurance the tax consequences are very similar. The decision is likely to depend on personal preference.

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Calculation results are only a guide and are not guaranteed, they should not be relied upon as a recommendation or advice that a particular course of action is suitable.

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