Lifetime Allowance (LTA) is the limit on the amount of pension benefit(s) that you can take from all of your registered pension arrangements, before you incur a tax charge on the value of your pension above the LTA. These benefits include:

  • lump sums; and
  • retirement income.

The current standard Lifetime Allowance is £1,073,100.

We will calculate your LTA either when you retire, or at age 75 if earlier. We calculate this by:

  • multiplying your annual pension payment by 20; and
  • adding any lump sum entitlement.

Based on the current standard LTA, if you only have Civil Service pension benefits and they exceed the amounts listed in the table below you may incur a tax charge. If you have other pensions in addition to your Civil Service pension, you may exceed the LTA at lower amounts of Civil Service pension.

LTA limits


Pension per annum of £46,656.52, automatic lump sum of £139,969.56

premium, nuvos, alpha

Pension per annum of £53,655.00 (if taking no lump sum)

classic plus

Between £46,656.52 and £53,655.00 pension per annum plus any automatic lump sum

For information

If the LTA value of your total pension benefits was in excess of £1m at 5 April 2016, you can apply to have a personal Lifetime Allowance (instead of the standard Lifetime Allowance) of between £1m and £1.25m from 6 April 2016 with Individual Protection 2016.

Fixed Protection 2016 can be applied for if you wish to fix your personal Lifetime Allowance at £1.25m from 6 April 2016. However, it is highly likely this protection would be lost immediately if membership of a scheme had continued past 5 April 2016.

Visit the website for more information

Retiring having breached the Lifetime Allowance

If you retire with an LTA breach you will receive a 25% tax charge. This reduction in pension is a one-off and permanent. The tax charge due (the “recovery charge”) is then paid to HMRC by the scheme.

You can request for your lump sum to be reduced instead, which incurs a one-off 55% tax charge.

Details of the LTA charge are covered in HMRC’s Pensions Tax Manual

Please see the hypothetical worked example below, which is based on the current LTA limit of £1,073,100.


Suppose we have a member age 60 with a pension of £60,000 and a lump sum of £250,000. The member has not used up any LTA elsewhere.

The available LTA = £1,073,100.

The lump sum is deemed to have crystallised first:

After the lump sum, the available LTA = £823,100 (£1,073,100 - £250,000)
Maximum pension up to the LTA = £41,155 (£823,100 / 20)
Excess pension = £18,845 (£60,000 - £41,155)
Chargeable amount = £376,900 (£18,845 x 20)
Recovery charge (RC) = £94,225 (£376,900 x 25%)
Pension equivalent of RC = £4,730.17 (£94,225 / 19.92*)
Residual excess pension = £14,114.83 (£18,845 - £4,730.17)
Full residual pension = £55,269.83 (£41,155 + £14,114.83)

*actuarial factor based on age

With a recovery charge paid by the scheme of £94,225, the benefits payable would be an annual pension of £55,269.83 and a lump sum of £250,000.

Note that the LTA percentage is based on the value before any reduction for the recovery charge:

  • LTA value: (20 x £60,000) + £250,000 = £1,450,000
  • LTA percentage: 100 x £1,450,000 / £1,073,100 = 135.12%

These benefits represent 135.12% of the standard LTA.

The reduction could be made against the lump sum instead:

LTA value of potential benefits = £1,450,000 ([20 x £60,000] + £250,000)
Chargeable amount = £376,900 (£1,450,000 - £1,073,100)
Recovery Charge = £207,295 (£376,900 x 55%)
Lump sum payable = £42,705 (£250,000 - £207,295)


With a recovery charge paid by the scheme of £207,295, the benefits payable would be an annual pension of £60,000 and a lump sum of £42,705.

The LTA percentage would still be 135.12% of the standard LTA.

The actuarial factors for converting the recovery charge into a pension equivalent are available on the dedicated actuarial factors page.

When you come to retire, we will issue you with a retirement quotation, which will include a personal details form.

Once you have returned this form with details of any other benefits and any LTA protection you may have, we will perform the above calculation and send further options to you.

7 December 2021
Last updated:
7 March 2022