Uncertainty on if the lifetime allowance will be brought back under a Labour government has caused anxiety
saving to be answered by our expert, Tom Selby, director of public policy at investment platform AJ Bell. There is nothing he doesn’t know about pensions. If you have a question for him, email us at
Once you reach age 55 , you can withdraw from your pension pot as you see fit, with a quarter of your fund available tax-free and the rest taxed in the same way as income. The lifetime allowance was the limit set on the total pensions you could build over your lifetime. Prior to being abolished in April this year, the lifetime allowance was set at £1,073,100. In its place, the Government introduced limits on lump sums that you can pass on to beneficiaries tax-free after you die.
The most obvious way to do this would be to “crystallise” your pension ahead of the general election. For a DB scheme, this would just mean taking your income – some schemes allow you to do this early, although you will likely receive a cut to your annual income.retirement
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