Pensions  

Is your client caught by the lifetime allowance?

  • Describe how the lifetime allowance works
  • Describe what happens with a benefit crystallisation event
  • Identify alternatives to hitting the lifetime allowance
CPD
Approx.30min

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Many people dislike the arbitrary nature of the LTA tax charge and the fact it penalises those clients who obtain good returns on their investments.

However, it is part of the current pension tax framework, and remains a key aspect where people need the expertise financial advisers can bring.

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Andrew Tully is technical director of Canada Life

CPD
Approx.30min

Please answer the six multiple choice questions below in order to bank your CPD. Multiple attempts are available until all questions are correctly answered.

  1. What is the current level of the lifetime allowance?

  2. What happens if the value of the benefits exceeds the lifetime allowance and the excess stays in the pensions wrapper?

  3. What happens when a benefit crystallisation event occurs, to one's remaining lifetime allowance, if one has taken benefits in different tax years?

  4. When is an alternative benefit to a pension useful?

  5. Applying for individual protection is no longer an option, true or false?

  6. For whom will a 25 per cent tax charge be suitable?

Nearly There…

You have successfully answered all the questions correctly, well done!

You should now know…

  • Describe how the lifetime allowance works
  • Describe what happens with a benefit crystallisation event
  • Identify alternatives to hitting the lifetime allowance

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