Your LTA is the total amount you can build up from all your pension savings in your lifetime without incurring a tax charge.
The LTA charge was removed on 6 April 2023.
If you retired on or after 6 April 2023, there will be no LTA charge on the pension benefits paid to you. Any charges already being paid will continue.
LTA was abolished in April 2024.
With the exception of your State Pension and any pensions being paid to a dependant or survivor, all pension benefits that you have accumulated within and outside of the NHS Pension Scheme, use up a percentage of your LTA. This percentage is normally calculated at the point at which you take your pension benefits.
This is known as a benefit crystallisation event.
For the NHS Pension Scheme, a crystallisation event is the later of either:
- the date the pension was payable from
- the date the benefit payment was authorised
Further benefit crystallisation events will take place each time a pension is revised through a sub-award using the relevant LTA at the time the pension is revalued.
The percentage is calculated on the actual benefits that are put into payment.
When you claim your NHS Pension Scheme benefits, your award letter will confirm the percentage of the LTA that your NHS Pension benefits have used.
The standard LTA is currently £1,073,100.
Without LTA protection, NHS Pension benefits at retirement will exceed a LTA of £1,073,100 at the following pre-commutation pension amounts:
- 1995 Section - £46,656
- 2008 Section - £53,655
- 2015 Scheme - £53,655
The maximum retirement lump sum you'll be able to take tax-free is £268,275.
If you have LTA protection from HM Revenue & Customs (HMRC), you may be able to take a higher tax-free retirement lump sum.
Read more information on LTA on our website.
Percentage of LTA
We cannot estimate the percentage of LTA that your NHS Pension benefits will use. This cannot be calculated accurately until your pension benefits are put into payment.
Members who retired on or after 6 April 2006, can check the percentage of LTA they used on their award letter.
Applying for LTA protection
You apply for protection through HMRC.
You may need to provide a valuation of your NHS Pension.
Forms to request a valuation and further information on LTA is available on our website.
If you need a valuation of a Money Purchase Additional Voluntary Contributions (MPAVCs), contact your provider(s).
You can still claim your pension whilst waiting for an LTA protection certificate. We’ll calculate your award on the basis that you do not have protection. This will be recalculated on receiving confirmation that protection has been granted.
Confirmation we accept includes:
- a copy of the certificate
- a copy of the email from HMRC confirming the type and value of your protection