Individual protection from the lifetime allowance: what are the features and implications of IP14?
Another reduction in the lifetime allowance, scheduled for April 2014, means another round of protections. The forthcoming reduction in the lifetime allowance (LTA) will mean that people who have planned their retirement savings by reference to the current £1.5m LTA will need some form of transitional protection in recognition of that planning.
December 2012 saw the announcement that the LTA would be reduced from £1.5m to £1.25m, with effect from 6 April 2014 (the annual allowance will also be reduced on that date to £40,000). This forthcoming reduction in the LTA prompted the announcement that ‘fixed protection 2014’ would be introduced. Under fixed protection 2014, the individual concerned will have an LTA of £1.5m, but will lose that protection if there is any benefit accrual on or after 6 April 2014.
The possibility of a further form of protection was confirmed in last year’s Budget. Following discussions with the pensions industry, a consultation paper issued by HMRC and the Treasury set out how a new individual protection would join the existing suite of protections from the LTA. Last month, HMRC published its response document as well as guidance for scheme administrators and draft legislation (in the form of the Finance Bill)…
If you are registered and logged in to the site, click on the link below to read the rest of the Wragge & Co briefing. If not, please register or sign in with your details below.
Sign in or Register to continue reading this article
It's quick, easy and free!
It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.Register now
Why register to The Lawyer
In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.
Identify the major players and business opportunities within a particular region through our series of free, special reports.
Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.
More relevant to you
To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.
News from Wragge Lawrence Graham & Co
News from The Lawyer
Briefings from Wragge Lawrence Graham & Co
The changes likely to have most impact upon the automotive and asset finance industries.
Also: burden of proof in wrongful trading cases; and more.