The lifetime allowance (LTA) was the total amount of pension you could build up from all your pension savings over your lifetime before you had to pay a tax charge.

This included:

  • your Derbyshire Pension Fund benefits
  • pensions you hold with other LGPS funds
  • pension benefits you may have had in other tax registered pension arrangements

It didn't include your State Pension or dependant’s pensions.

From 6 April 2024, LTA was abolished.

The limit of £1,073,100 remained for the tax year 6 April 2023 to 5 April 2024, however, there were no LTA charges for the period.

Pension commencement lump sums

Whilst the LTA has been removed, the maximum amount most LGPS members can take as a pension commencement lump sum will be frozen at £268,275, which is 25% of the 2023-2024 standard LTA.

Exceeding the LTA

The LTA didn’t affect most members. However, if you’re a high earner, or have a lot of LGPS membership in terms of the years that you’ve been in the scheme, you might have been at risk of exceeding the limit.

Your annual benefit statement included the amount of LTA used for that pension as a percentage. The figures were based on the LGPS pension and lump sum you’d built up with us. The percentage didn’t include any additional voluntary contributions (AVCs) you'd paid for.

More information

You can find examples of LTA calculations on the national LGPS member website.

Video: Your lifetime allowance

This video explains pension growth, how to calculate your current value, tax charges and available protections. For subtitles select ‘CC’ (closed captions).