Pensions

  • Lifetime allowance for pension contributions: reduced from £1.25 million to £1 million, from 6 April 2016, with transitional provisions.
  • Serious ill-health lump sums – under age 75: permitted to be paid out of remaining funds even after pension savings have been accessed, with effect from the day after Royal Assent to the Bill.
  • Serious ill-health lump sums – age 75 or over: 45% tax charge replaced by charge at individual’s marginal rate with effect from the day after Royal Assent to the Bill.
  • Charity lump sum death benefits: aligning the treatment of amounts paid out of drawdown and flexi-access drawdown funds with treatment of amounts paid out of uncrystallised funds, and other restrictions removed, with effect from the day after Royal Assent to the Bill.
  • Trivial commutation lump sums: may be paid out of a money purchase scheme where the pension is already in payment, with effect from the day after Royal Assent to the Bill.
  • Top-ups to dependants’ death benefits: where on a member’s death the scheme must top up the remaining funds to meet a dependant’s lump sum entitlement, the full amount will be an authorised payment, with effect from the day after Royal Assent to the Bill.
  • Dependants’ scheme pensions: a simplification measure removing the need for certain calculations, from 6 April 2016.
  • Dependants’ flexi-access drawdown: to continue beyond age 23 rather than the dependant being required to take a single lump sum or suffer 70% tax charge, with effect from the day after Royal Assent to the Bill.
  • Bridging pensions: HMRC enabled to adjust the rules on bridging pensions to accord with the new state pension scheme, from 6 April 2016.
  • Pensions from Netherlands government for victims of persecution 1940-1945: exempt from income tax from April 2016.