Pension premiums

Pension premiums

Minimum age for taking benefits 55
Annual allowance  £40,000
Lifetime allowance £1,000,000 
Normal maximum tax-free lump sum 25%

Annual allowance

There may be entitlement to a greater allowance if there are unused reliefs from the three earlier tax years. The relief may however be reduced to £10,000 if pension savings are accessed under the new rules for accessing benefits introduced on 6 April 2016.

Reduced annual allowance for those earning over £150,000

With effect from April 2016 there will be a reduction in the £40,000 annual pension allowance where income, including pension contributions exceeds £150,000. There will be a tapering away of the annual allowance to a minimum of £10,000

The lifetime allowance reduces to £1 million with effect from 6 April 2016. Transitional protection for pension rights already over £1 million will be introduced at the same time to ensure the change is not retrospective.

From April 2016, the government will legislate to allow people who are already receiving income from an annuity to agree with their annuity provider to assign their annuity income to a third party in exchange for a lump sum or an alternative retirement product.