Pensions 'in-depth': the lifetime allowance

Volume 1: Establishing the client’s individual lifetime allowance

Paul Kennedy and Paul Squirrell take an in-depth look at some of mechanisms underpinning the pensions lifetime allowance. As this is a voluminous subject, here they look in more depth at the beginning of the journey. 

Drawing upon their experience of the types of more advanced questions that have arisen from advisers and paraplanners, they attempt to give more clarity around matters concerning lifetime allowance protections, lifetime allowance enhancement factors and reduced lifetime allowances.   

Areas covered in this video:

  • 02:53 >> What is the lifetime allowance?
  • 04:10 >> Protection from the lifetime allowance charge: Enhanced and Fixed Protections
  • 05:34 >> Protection from the lifetime allowance charge: Primary and Individual Protections
  • 19:06 >> Losing the protection: Enhanced or Fixed Protection
  • 32:16 >> ‘Losing’ primary or individual protection 
  • 40:46 >> Reduced lifetime allowances
  • 45:07 >> Enhancements to the lifetime allowance
  • 53:16 >> Protection from the lifetime allowance charge: Lifetime allowance enhancement factors

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Your LTA checklist

Here we highlight relevant considerations when assessing an individual’s pension savings and the impact of the lifetime allowance, through 4 steps:

  1. Establishing the amount of the individual’s lifetime allowance
  2. General enhancements and reductions to an individual’s LTA
  3. Considering how and when benefits will be tested against LTA
  4. Salient considerations and working through options and possibilities


Your LTA technical guide

A useful reference aid that includes all the detail around:

  • Transitional protection
  • LTA enhancements/reductions
  • Benefit crystallisation events (LTA test trigger events)
  • The lifetime allowance charge


Client-friendly LTA guide to help discussions

Share this guide with your clients which covers:

  • Who could be affected
  • How to calculate the value of their pensions
  • What steps those affected can take to minimise tax bills


Questions and feedback

Are there any other questions that you have on this subject? Whilst, we can’t undertake to respond to you individually, we’d like to take account of your feedback to help develop material that best assists you.

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