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This guidance note looks at the lifetime allowance which applied until 5 April 2024. The lifetime allowance charge was removed from 6 April 2023 and the lifetime allowance itself was abolished from 6 April 2024. For details of the replacement system for taxation of pension lump sums, see the Pension income and lump sum allowances from 6 April 2024 guidance note. The commentary below covers the rules that apply prior to that date.

Until 6 April 2024, the maximum amount that an individual could build up within registered pension schemes was limited in two ways, by a charge (the lifetime allowance charge) based on the value of the fund and attributable pension benefits, if the value exceeded the lifetime allowance, and by a limit on the maximum annual tax-relieved pension input amount permitted. See the Annual allowance guidance note.

The operation of the lifetime allowance and the lifetime allowance charge (that could arise before 6 April 2023) are discussed below. The lifetime allowance was introduced from 6 April 2006. Prior to 6 April 2023, when a member of a