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Should I get individual protection for my pension?

19 July 2021

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Question by David

So, as at April 5th 2016 the value of my pensions was £1,021,390. I had contributions to pensions in 2017 I was considering applying for Individual protection 2016, which I understand would give me an LTA of £1,021,390. However, following the inflation rise of the Lifetime Allowance, it seems the LTA is now at £1,030,000. It now seems pointless applying for Individual protection 2016. Have I got this right?

Answered by Boring Money

You are spot on with your analysis. The standard lifetime allowance is now £1,030,000* and is planned to continue increasing in rise with the change in inflation each year. However, the lifetime allowance has been tinkered with so much since it was introduced that there is no telling what might happen to it in the future. You are linked to the standard lifetime allowance and this could be cut again down the track, possibly with no protection for people such as you.

Even though it may seem like there’s little point in applying for Individual Protection 2016, there’s nothing to lose by doing so. You can apply for this protection online here. It doesn’t take long and is well worth having, just in case!

Answered by

Boring Money