Changes to the Lifetime Allowance
As recently announced by the UK Government in its Spring 2023 Budget, there will be no 55% tax charge for breaching the Lifetime Allowance (LA) in the tax year 2023/24. The LA itself will be abolished from 6 April 2024*.
Please rest assured that your existing GL & EGLP arrangements insured with Generali UK will continue providing the same coverage and benefits and will not change unless you specifically request it.
For the time being, in cases where the insured benefit is capped to the LA, a notional amount equivalent to the 2022-23 LA value £1,073,100 will be used. Similarly, where benefit payable has the LA specified as a deduction, where necessary the same notional value will be used.
Based on our current understanding as at date of publication:
- Where the excess over the LA is paid as a lump sum, income tax at the recipient’s marginal rate of income tax would normally be deducted from the excess before the balance is paid to the member*.
If you need any further assistance in this respect, we encourage you to seek professional advice from your EB Consultant or a Tax specialist as appropriate.
If you have any further questions, please do not hesitate to contact eb.enquiries@generali.co.uk
Disclaimer:
All information contained herein represents the views and opinions of the author as at the date of writing and is provided for general information only. Nothing herein constitutes or is intended to constitute financial or other forms of advice and no individual should rely upon the information provided in making a specific investment decision without first seeking independent professional advice.