UK Pensions - Abolition of the lifetime allowance confirmed for 6 April 2024: what should trustees and employers be thinking about?
On 15 March 2023, the Chancellor of the Exchequer, Jeremy Hunt, delivered the Government’s Spring Budget 2023.
The pensions-related Budget announcements were the most significant for some years and included the announcement that the lifetime allowance would be abolished from 6 April 2024. This was subsequently confirmed in the Autumn Statement.
The Government has now published the Finance Bill, which includes over 100 pages of legislation to repeal the provisions of the Finance Act 2004 relating to the lifetime allowance. But the changes go further than this and include the introduction of two new allowances for lump sums. For many registered pension schemes, the changes are likely to have an impact on the benefits and options provided by the scheme, and it may be necessary to amend scheme rules as a result.
We outline the key changes provided for by the Finance Bill, and highlight the main considerations for trustees and employers.