Waveney McKenna

The lifetime allowance reduces from April 2012, it is important for those with pension funds over or close to £1,500,000 to consider whether to apply for fixed protection. This will effectively retain the current lifetime allowance of £1,800,000 although no further pension contributions can be paid.

The considerations can be complex, where you benefit from a large employer contribution or attractive superannuation pension you need to consider whether you are likely to breach the lifetime allowance and if so whether you retain membership of the scheme or cease membership to preserve the higher annual allowance.

Fund values over the lifetime allowance are subject to a potential 55% tax charge if the excess is paid as a lump sum at retirement.