Skip to main content

This is a new service – your feedback will help us to improve it.

Posted Sat, 28 Oct 2023 11:28:46 GMT by Jemima
Hello, HMRC. I have a defined benefit pension entitlement and AVCs with the same employer. I am now eligible to withdraw a pension and the pension administrator has given me the option of rolling my AVCs into the defined benefit pension. I was granted Fixed Protection 2016 LTA in 2021 and this is still valid. Will I lose the FIxed Protection 2016 LTA if I roll the AVCs now into my defined benefit pension? I am currently living abroad and I am not tax resident in the UK, but I might return to live in the UK soon. Thanks a lot for your help.
Posted Wed, 01 Nov 2023 10:15:18 GMT by HMRC Admin 20
Hi Jemima,

Please refer to Losing your lifetime allowance protection as there a number of factors involved for when you applied.

Thank you.
Posted Tue, 28 Nov 2023 16:32:35 GMT by Jemima
Dear HMRC, Thank you for your reply. I have consulted the page to which you referred. As I understand it, as I have fixed protection 2016 LTA that was granted in 2021, I had to adhere to the restrictions on what I could do with the pension and AVCs until 6th April 2023. Thereafter, I was free to combine my AVCs with my defined benefit pension (that was generated with the same employer), without losing fixed protection 2016 LTA. I am having problems because the scheme administrator for the defined benefit scheme is offering to combine the AVCs with the defined benefit pension to give a larger tax-free lump sum and a larger annuity, but is insisting that in doing so, I would lose fixed protection 2016 LTA. The defined benefit scheme administrator has a copy of the fixed protection 2016 certificate, which was issued in 2021, and fully accepts that the protection is currently valid. In essence the administrator seems to believe that the restrictions on what I can do with the pension and AVCs still apply today, despite my protection being issued in 2021. Therefore I need to know if I am correct in believing that because my fixed protection was granted before March 2023, the restrictions in what I do with the defined benefit pension and the AVCs only apply in the period from 2016 until 6th April 2023. If that is correct, I would appreciate your confirmation so that I can take it to the scheme administrator, which I assume has been giving the same information to other clients. Thank you very much for your help.
Posted Thu, 30 Nov 2023 12:49:33 GMT by HMRC Admin 10
We can only provide general information / guidance in this forum.  
For an answer to a detailed question of this nature, you would need to contact our self assesment helpline on 0300 200 3310, or seek professional advice.

You must be signed in to post in this forum.