Life Time Allowance

[AsleepInYorkshire]

Sorry to go over old ground. I'm not quite digesting this subject as well as I need to.

I know the LTA is an allowance not a limit.

But after that I'm struggling to comprehend exactly how it works.

Can anyone explain in lay man's terms for me please or drop a link in to a plain English site?

Thank you

AiY(D)

[mc2fool]

Does this help?

https://www.moneyhelper.org.uk/en/pensions-and-retirement/building-your-retirement-pot/lifetime-allowance-for-pension-savings

[MyNameIsUrl]

I need to understand this topic too and have found a couple of relatively simply-worded sites:

https://adviser.royallondon.com/technic ... ce-charge/

https://www.pruadviser.co.uk/knowledge- ... #section-5

If you have a small number of pension pots and intend to withdraw some money, for most people the calculations are fairly simple. But as with most tax legislation, there are dozens of ifs and buts and caveats which can make understanding what's going on quite difficult.

What I struggle to understand is not how to do the calculation (the scheme administrators do that anyway) but what to do with the number once I've got it. Do I need to tell HMRC? Put it on my tax return? Or just keep the number in my own records, adding up the percentages over the years?

[ursaminortaur]

I need to understand this topic too and have found a couple of relatively simply-worded sites:

https://adviser.royallondon.com/technic ... ce-charge/

https://www.pruadviser.co.uk/knowledge- ... #section-5

If you have a small number of pension pots and intend to withdraw some money, for most people the calculations are fairly simple. But as with most tax legislation, there are dozens of ifs and buts and caveats which can make understanding what's going on quite difficult.

What I struggle to understand is not how to do the calculation (the scheme administrators do that anyway) but what to do with the number once I've got it. Do I need to tell HMRC? Put it on my tax return? Or just keep the number in my own records, adding up the percentages over the years?

The only times that you really need the percentages used are when doing your own calculations as to how close you are to exceeding the LTA limit or if you have pensions with multiple providers and need to tell one of the providers how much of the LTA limit has already been used up by taking previous pensions with other providers.