LTA freeze: Rishi Sunak sends 'wrong message' to pension savers

'Under the radar revenue raiser'

Jenna Brown
clock • 6 min read

Rishi Sunak’s decision to freeze the lifetime allowance (LTA) for pension contributions has been widely criticised by pensions experts who say the move sends the “wrong message” to savers.

Sunak confirmed the decision to freeze the LTA, along with capital gains tax, inheritance tax and income tax brackets, in today's Budget speech. The LTA will remain at its current level of £1,073,100 for 2020/21 rather than increasing in line with inflation. It had been expected to rise by £5,800 in 2021/22, in line with 0.5% Consumer Prices Index.  In a widely predicted move - it was leaked last week - the freeze is estimated to raise an extra £990m in revenue by tax year 2025/26. Canada Life technical director Andrew Tully said: "This measure simply sends the wrong signal to save...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Pensions

Government publishes Pensions Investment Review interim report and launches DC and LGPS consultations

Government publishes Pensions Investment Review interim report and launches DC and LGPS consultations

Report published as Reeves delivered inaugural Mansion House speech

Jonathan Stapleton
clock 15 November 2024 • 4 min read
Chancellor to create DC 'megafunds' in Mansion House growth bid

Chancellor to create DC 'megafunds' in Mansion House growth bid

Chancellor to unveil ‘biggest pension reforms in decades’

Martin Richmond
clock 14 November 2024 • 3 min read
Pensions dashboards could leave savers at risk of 'poorly informed' transfers

Pensions dashboards could leave savers at risk of 'poorly informed' transfers

Research finds two-fifths of savers likely to use dashboards to carry out a pension transfer

Martin Richmond
clock 13 November 2024 • 3 min read