The Chancellor’s Spring Budget delivered on 15 March 2023 brought with it some significant changes to UK pension taxation from 6 April 2023. If you are impacted by any of the changes we recommend you seek professional advice prior to taking any action.
The lifetime allowance is the maximum amount of savings you can have at retirement from all pension schemes without incurring an additional tax charge. The additional tax charge on any lifetime pension savings above the lifetime allowance will no longer apply from 6 April 2023.
The annual allowance (AA) is the maximum amount of pension benefits you can save each year with the benefit of tax relief. The annual allowance will increase for everyone from 6 April 2023. For the 2023/24 tax year, it is £60,000, but if you have a high income or have started to draw money purchase benefits in a flexible way, your AA may be as low as £10,000 a year.