The Pensions (Abolition of Lifetime Allowance Charge etc) Regulations 2026

Part 1

Introductory

Citation, commencement and effect

1. -(1) These Regulations may be cited as the Pensions (Abolition of Lifetime Allowance Charge etc) Regulations 2026.

• (2) Subject to paragraphs (4) to (6), the amendments made by these Regulations have effect for the tax year 2024-25 and subsequent tax years.
• (3) The amendments made by regulations 2(6) and 14(4) to (7) have effect in relation to payments made on or after 29th June 2026.
• (4) The amendments made by regulation 4(2) have effect in relation to lump sums paid on or after 29th June 2026.
• (5) The amendments made by regulation 12 have effect in relation to transfers made on or after 29th June 2026.
• (6) These Regulations come into force on the day after the day on which they are made.

ITEPA 2003

2. -(1) ITEPA 2003 is amended as follows.

(2) In section 574A ('pension': relevant lump sums), in subsection (3), in Step 3, in paragraph (b), at the end insert 'and all of the member's lump sum and death benefit allowance is available'.

(3) In section 637Q (availability of individual's lump sum allowance), after subsection (6) insert-

'(6A) Where more than one relevant benefit crystallisation event occurs in relation to an individual on the same day, it is for the individual to decide the order in which they are to be treated as occurring for the purposes of this section.'

(4) In section 637S (availability of individual's lump sum and death benefit allowance), after subsection (7) insert-

'(7A) The individual's decision under subsection (7), so far as it relates to events that are relevant benefit crystallisation events for the purposes of section 637Q, must be consistent with the individual's decision under subsection (6A) of that section.'

(5) In section 637T (section 637S: multiple lump sum death benefits paid)-

• (a) in the heading, for 'Section 637S:' substitute 'Availability of individual's lump sum and death benefit allowance where';
• (b) for subsection (3) substitute-

'(3) The amount of the individual's lump sum and death benefit allowance that is available on the occurrence of any of the relevant benefit crystallisation events mentioned in subsection (1) is the relevant proportion of the undivided available amount.

(3A) In subsection (3), 'the undivided available amount' means the amount of the individual's lump sum and death benefit allowance that would, apart from that subsection (but after taking into account subsection (2)), be available on the occurrence of the relevant benefit crystallisation event in question.'

(6) After section 637T insert-

' 637U Availability of individual's allowances where lump sums or lump sum death benefits already paid by non-UK schemes

(1) Subsection (2) applies where-

• (a) a payment within paragraph 1(1)(a) or (b) of Schedule 34 to FA 2004 (non-UK schemes: application of certain charges and protections etc) is made (or treated by Part 4 of that Act as made) to or in respect of an individual, and
• (b) the payment, or any part of it, is treated by virtue of that Schedule as-

(i) a pension commencement lump sum, or

• (ii) an uncrystallised funds pension lump sum,

for the purposes of the member payment charges.

(2) In determining under section 637Q (availability of individual's lump sum allowance) the availability of the individual's lump sum allowance on the occurrence of any subsequent relevant benefit crystallisation event, the payment, or part of the payment, mentioned in subsection (1)(b) is to be treated as a relevant lump sum within the meaning of that section.'

Schedule 29 to FA 2004

4. -(1) Schedule 29 to FA 2004 (registered pension schemes: authorised lump sums supplementary) is amended as follows.

(2) In paragraph 8 (trivial commutation lump sum)-

• (a) in sub-paragraph (1)(c), for 'under a registered pension scheme' substitute 'to which subparagraph (3) applies';
• (b) at the end of sub-paragraph (1)(c) insert ', and
• (d) if, at any time in the period beginning with 6 April 2006 and ending with the nominated date, there has been a transfer of sums or assets held for the purposes of, or representing accrued rights under, a registered pension scheme so as to become held for the purposes of or to represent rights under a qualifying recognised overseas pension scheme in connection with the member's membership of that pension scheme, the aggregate of the amount of any sums transferred and the market value of any assets transferred.';
• (c) after sub-paragraph (2) insert-

'(3) This sub-paragraph applies to any lump sum paid under a registered pension scheme that is not any of the following-

• (a) a short service refund lump sum;
• (b) a refund of excess contributions lump sum;
• (c) a trivial commutation lump sum;
• (d) a winding-up lump sum.'

Schedule 9 to FA 2024

9. -(1) Part 6 of Schedule 9 to FA 2024 (pensions: transitional provision) is amended as follows.

(2) In paragraph 127A (availability of member's overseas transfer allowance)-

• (a) in sub-paragraph (1)-

• (i) in paragraph (a) omit the 'and' at the end;

• (ii) at the end of paragraph (b) insert ', and

• (c) at the time the transfer is made, the individual is not an individual to whom paragraph 12 of Schedule 36 to FA 2004 applies (enhanced protection).';

• (b) in sub-paragraphs (2) and (3)(b) omit 'adjusted';

• (c) for sub-paragraph (4) substitute-

'(4) Sub-paragraph (5) applies where the individual's lifetime allowance previouslyused amount includes one or more amounts ('crystallised drawdown amounts') that are attributable to the occurrence, before 6 April 2024, of benefit crystallisation event 1 (designation of money purchase funds for drawdown).'

(3) In paragraph 127B (provision of information by individuals to certification administrators), after sub-paragraph (8) insert-

'(8A) Sub-paragraph (8B) applies where-

• (a) a transitional tax-free amount certificate is issued in relation to an individual, and
• (b) the individual subsequently becomes a member of a pension scheme ('the new pension scheme').

(8B) The relevant person must send a copy of the certificate to the scheme administrator of the new pension scheme.'

The Registered Pension Schemes (Provision of Information) Regulations 2006

12. In the Registered Pension Schemes (Provision of Information) Regulations, in regulation 14ZC (information provided by scheme administrators on recognised transfers), after paragraph (7) insert-

'(8) Paragraph (9) applies if-

• (a) in connection with a member of a registered pension scheme ('the transferring scheme'), there is a recognised transfer from the transferring scheme to another registered pension scheme ('the recipient scheme'), and
• (b) either-
• (i) immediately before the transfer, the member is entitled under any arrangement under the transferring scheme to a stand-alone lump sum, or
• (ii) at some time in the future the member would (in the absence of the transfer or any other transfer) become entitled under any such arrangement to such a lump sum.

(9) The scheme administrator of the transferring scheme must provide the scheme administrator of the recipient scheme with a statement stating the amount of the 5th April 2023 maximum.'