HMRC has launched its new online service for pension scheme members to apply to protect their pension savings from the lifetime allowance tax charge. The lifetime allowance was reduced to £1.25m on 6 April 2014 (from £1.5m) and to £1m on 6 April 2016. The protection options still available are:
· fixed protection 2016 (FP2016), which fixes the lifetime allowance at £1.25m;
· individual protection 2016 (IP2016), which protects the lifetime allowance to the value of pension savings at 5 April 2016, subject to a maximum of £1.25m; and
· individual protection 2014 (IP2014), which protects the lifetime allowance to the value of pension savings at 5 April 2014, subject to a maximum of £1.5m, and must be applied for by 5 April 2017.
The new online service replaces the interim paper process for applying for fixed protection 2016 (FP2016) and individual protection 2016 (IP2016) and replaces the online form for applying for individual protection 2014 (IP2014). The interim processes will no longer be available after 31 July 2016. See www.bit.ly/2asC04O.
HMRC has also published a guide to working out the value of a pension for the purposes of applying for IP2014 and IP2016 (see www.bit.ly/2azd9yx).
HMRC has launched its new online service for pension scheme members to apply to protect their pension savings from the lifetime allowance tax charge. The lifetime allowance was reduced to £1.25m on 6 April 2014 (from £1.5m) and to £1m on 6 April 2016. The protection options still available are:
· fixed protection 2016 (FP2016), which fixes the lifetime allowance at £1.25m;
· individual protection 2016 (IP2016), which protects the lifetime allowance to the value of pension savings at 5 April 2016, subject to a maximum of £1.25m; and
· individual protection 2014 (IP2014), which protects the lifetime allowance to the value of pension savings at 5 April 2014, subject to a maximum of £1.5m, and must be applied for by 5 April 2017.
The new online service replaces the interim paper process for applying for fixed protection 2016 (FP2016) and individual protection 2016 (IP2016) and replaces the online form for applying for individual protection 2014 (IP2014). The interim processes will no longer be available after 31 July 2016. See www.bit.ly/2asC04O.
HMRC has also published a guide to working out the value of a pension for the purposes of applying for IP2014 and IP2016 (see www.bit.ly/2azd9yx).
