Most members can take up to a maximum of 25% of the capital value of their LGPS benefits as a lump sum.
There are limits on the amount of tax-free cash you can take from your pensions.
There are 2 pension tax limits:
- Lump Sum Allowance (LSA). The LSA is £268,275. It is the amount of tax-free lump sum you can take across all your pensions.
- Lump Sum and Death Benefit Allowance (LSDBA). The LSDBA is £1,073,100. It limits the amount of tax-free cash across all your pensions when you die.
Most individuals will not meet these limits.
These tax-free allowances are in place of the Lifetime Allowance (LTA). The LTA was abolished from April 2024. Find out about changes to the LTA
A new Transitional Allowance takes account of any LTA used before 6 April 2024. It reduces your Lump Sum Allowance (LSA) by 25% of the LTA previously used unless we are provided with a transitional tax-free certificate. Find out about the Transitional Allowance
There are special rules for members with existing HMRC Lifetime Allowance (LTA) protection. The LSA and LSDBA may be increased if a member holds a valid LTA protection. Find out about LTA protections in tax controls and pensions