New pension scheme benefit allowances - further changes to be announced.

The lifetime allowance has been abolished with effect from 6 April 2024 and replaced with two new allowances - the lump sum allowance (LSA) and the lump sum and death benefit allowance (LSDBA).

Please read our guide providing an overview of the new allowances and how they will work. 

Pension scheme benefit allowances guidance 

However, in their latest pension newsletter (158), HMRC has confirmed that further 'minor technical changes' will be required through a second set of regulations and that some clients should postpone taking certain actions until the amended legislation is in place.

These relate primarily to:

• scheme-specific lump sum protection
• individuals who plan to transfers their pension savings to a qualifying recognised overseas pension scheme (QROPS)
• transfers where the member has Enhanced Protection
• transfers to QROPS from drawdown or those including pre-A-Day benefits
• taking benefits where the member has enhanced or primary protection with protected cash greater than £375,000
• payment of lump sum death benefits from funds which crystallised before 6 April 2024.

We will continue to monitor any changes to the new legislation and provide updates as appropriate.