Steep charges for exceeding lifetime allowance
May 16th, 2018
The amount of tax collected for people whose pension exceeds the Lifetime Allowance (LTA) has ballooned by 1,000% since the policy was introduced in 2006-07. When the LTA was brought in, the tax collected was less than £10m, but the tax taken has now grown to £110m in 2016-17. The LTA was introduced in 2006, aiming to limit the value of payments from pension schemes before tax charges occur. There is an obvious link to make between the increase in tax take and the slashing of the lifetime allowance over the last six tax years. And most experts think it is just the start, and that the government’s tax take from the lifetime allowance will continue to grow substantially in the future.
Source: Technical Connection