HM Revenue & Customs has urged some pension savers to delay taking benefits until it has passed further legislative changes relating to the abolition of the lifetime allowance on 6 April.
In a newsletter published on 4 April, HMRC said members “may need to wait” until the regulations are in place before taking or transferring certain benefits to ensure that their available allowances and tax position do not need to be “revisited” later in the year.
It follows an earlier newsletter, in which the Treasury confirmed that there would be further minor technical changes made through a second set of regulations.
According to HMRC, cases that should hold off on include those with:
- Enhanced protection transfer cases
- Enhanced protection and primary protection cases with protected lump sum rights of more than £375,000
- requests for payment of a lump sum death benefit where the payment would be made from funds which crystallised prior to 6 April 2024
- request to transfer rights held under a registered pension scheme (drawdown) to a QROPS
- transfer rights held under a registered pension scheme to a QROPS, which involves pre-April 2006 benefits
- payment of a PCLS under scheme-specific lump sum protection.
While Chancellor Jeremy Hunt confirmed in last year’s Autumn statement that the lifetime allowance will be abolished from 6 April 2024, HMRC has not yet provided a timescale for the additional changes.
HMRC’s newsletter can be found HERE.
