If you have a UK pension valued over £1 million or stopped making contributions before 6 April 2016, you have one last chance to lock in a higher pension allowance. Fixed Protection 2016 (FP16) and Individual Protection 2016 (IP16) applications close on 6 April 2025—after that, you’ll be stuck with the standard limits – which are lower.
Why This Matters for You
Although the Lifetime Allowance (LTA) was abolished, key limits still apply:
- Overseas Transfer Allowance (OTA): How much you can move to a QROPS before the 25% Overseas Transfer Charge (OTC) kicks in.
- Lump Sum and Death Benefit Allowance (LSDBA): The total tax-free lump sums you (or your beneficiaries) can receive.
Without protection, both allowances are capped at £1,073,100. With protection, you could increase this to £1.25 million or more, reducing tax charges on lump sums and transfers.
Which Protection Works for You?
✅ Fixed Protection 2016 (FP16) – £1.25m allowance
- You must have stopped pension contributions before 6 April 2016.
- If granted, you can’t restart contributions without losing it.
✅ Individual Protection 2016 (IP16) – £1m to £1.25m allowance
- Available if your pension was worth at least £1 million on 5 April 2016.
- Your allowance is set at the lower of £1.25m or your pension value on that date.
- You can keep contributing without losing protection.
How to Apply Before 6 April 2025
- Apply via HMRC’s online pension protection service.
- No supporting documents needed for FP16.
- For IP16, you need proof of your pension value on 5 April 2016 (e.g., provider statements).
This Is Your Last Chance
If you qualify, don’t miss out—these protections could save you thousands in tax on lump sums or overseas transfers. After 6 April 2025, the opportunity is gone forever. Talk to us now to secure your higher allowances.
