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What is the lifetime allowance?

The lifetime allowance was a limit on how much you can build up in pensions in total over your lifetime. However, the tax charges for going over the lifetime allowance were abolished on 6 April 2023. From April 2024 the lifetime allowance will be abolished entirely.

This means that you'll usually be able to take up to 25% of your pension tax-free, with the rest taxed as an income. You will not pay any extra tax charges for going over the lifetime allowance.

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