Protect your pension lifetime allowance

The current standard lifetime allowance is £1,073,100. Read the previous rates of standard lifetime allowance.

You may be able to protect your pension savings from the 6 April 2016 reduction of the standard lifetime allowance, when it was reduced to £1 million. There are 2 protections you can apply for.

Protection	What it does	Can I keep building up my pensions?
Individual protection 2016	Protects your lifetime allowance to the lower of: • — the value of your pension savings at 5 April 2016 • — £1.25 million	Yes. But you must pay a tax charge on money taken from your pension savings that exceed your protected lifetime allowance.allowance if you take your pension before 6 April 2023.
Fixed protection 2016	Fixes your lifetime allowance at £1.25 million.	No,If exceptHMRC inreceived limitedyour circumstances.application Ifon or after 15 March 2023, you do,cannot you’ll:keep building up your pensions from 6 April 2016, except in limited circumstances. If —HMRC losereceived your fixedsuccessful protectionapplication 2016 before —15 payMarch tax2023 onand you still validly hold this protection, you can continue to build up your pensions without impacting the valuevalidity of your pensionFixed savingsProtection used2016 thatfrom exceed6 theApril standard2023. lifetimeThe allowanceprotection whencessation yourules takestill yourapply benefitsfrom 6 April 2016 to 5 April 2023.

Check your existing protection

To check your existing protection, you need a Government Gateway user ID and password. If you do not have a user ID, you can create one when you check.

Apply for individual protection 2016

You can apply if your pension savings were worth more than £1 million at 5 April 2016.

You can still apply if you already have:

• enhanced protection
• fixed protection
• fixed protection 2014
• fixed protection 2016

Individual protection 2016 will stay dormant until you lose or give up your previous protectionprotection. — tellTell HMRC in writing if this happens.

If you applied for protection from the 2016 reduction and received a temporary reference number, you must apply online for a permanent reference number.

You cannot apply if you’ve either:

• primary protection
• individual protection 2014

Before you start

To apply for individual protection, you need a Government Gateway user ID and password. If you do not have a user ID, you can create one when you apply.

You’ll also need to know know:

• what your pension savings were worth on 5 April 2016 and
• a breakdown of the amount.

If you do not know this information, you can ask your pension scheme administrator. If you have more than one scheme, add the amounts from each scheme together.

Check if there are any service problems, or times when it will not be available.

Apply for fixed protection 2016

You can apply if:

• you or your employer have not added to your pension savings since 5 April 2016
• you opted out of any workplace schemes by 5 April 2016

You can still apply for fixed protection 2016 if you already have individual protection 2014. Fixed protection 2016 will be dormant until you lose your previous protection. You should tell HMRC in writing when you have lost lifetime allowance protection.

You cannot apply if you have:

• enhanced protection
• primary protection
• fixed protection
• fixed protection 2014

If you applied for protection from the 2016 reduction and received a temporary reference number, you must apply online for a permanent reference number.

Before you start

To apply for fixed protection, you need a Government Gateway user ID and password. If you do not have a user ID, you can create one when you apply.

Check if there are any current service problems, or times when it will not be available.

After you’ve applied

Taking money from your pension scheme

Once you’ve applied for lifetime allowance protection through the online service you’ll receive 2 reference numbers that you’ll need to keep. These are your:

• protection notification number
• scheme administrator reference

You’ll need to give these reference numbers to your scheme administrator when you decide to take money from your pension schemes, to show that you have a lifetime allowance protection.

Your protection notification number will be shown as:

• FP16 followed by 10 digits and 1 letter for fixed protection 2016, for example FP161234567890A
• IP16 followed by 10 digits and 1 letter for individual protection 2016, for example IP161234567890B

Your scheme administrator reference will be shown as PSA followed by 8 digits and 1 letter.

You can find these reference numbers online, even if you did not apply for lifetime allowance protection online.

Report a change to your pension

Changes in your pension can affect if you can keep your individual protection for 2014 and 2016. You should tell HMRC if:

• the amount of your pension breakdown changes
• you need to add or change a pension debit because you receive a discharge notice as a result of a pension sharing order — you must tell us within 60 days of the pension debit

If you’ve protected your pension savings online you’ll be able to amend your protections yourself. For example, if you made mistakes with the values when you applied, or if you have pension debits which affect the amount you’re protected by.

To amend your protections, select the ‘pensions’ option. You’ll need the Government Gateway user ID and password you used when you applied.

If you did not protect your pension savings online, you should tell HMRC in writing about these changes. HMRC will write to you to let you know how it affects your protection.

If you’ve lost protection

IfThere you’veare lostcertain yourconditions protectionthat you’ll need to tellmeet HMRC in writing.order We’llto need:

• yourrely fullon name,your addressprotection andif Nationalyou Insurance number
hold:
• theenhanced exact date that you lost protection
• thefixed reason why you lost protection (for example benefit accrual, auto enrolment)
• thefixed typeprotection of pension arrangement (defined contribution or defined benefit)2014
• yourfixed originalprotection certificate (if you still have it), these were not issued for IP2016 or FP20162016

If you havedo anot papermeet certificate,these youconditions, should send this with the information in the bulleted list to us by post.

If you appliedmay forlose IP2016your orprotection FP2016 and dowill notneed haveto atell certificate,HMRC youin can send the information by emailwriting.