LTA tax take hits £382m in 2020/21, latest HMRC stats show

'Draconian' LTA 'should be scrapped' for DC pension savers

clock • 4 min read

The government netted £382m in tax charges from the pensions lifetime allowance (LTA) in 2020/21, latest statistics from HM Revenue & Customs (HMRC) reveal.

A total of £382m was paid in charges by 8,610 people whose drawings on their pensions exceeded the LTA limit, representing an 11% increase in tax take compared to the preceding year, according to analysis of the figures by consultancy Lane Clark & Peacock (LCP). It said the decision by the government to freeze the LTA at £1.0731m for five years until 2025/26  will become increasingly more significant for savers unless further action is taken.  LCP partner Karen Goldschmidt said: "Even when LTA limits keep pace with inflation, we see a steady increase in the number of people being caug...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Pensions

The importance of defining the roles within a SSAS

The importance of defining the roles within a SSAS

'Poor role discipline can create compliance, tax and fiduciary risk'

Caitlin Southall
clock 08 October 2026 • 4 min read
AJ Bell warns Budget could 'exacerbate' 76% pension lump sum withdrawal rate

AJ Bell warns Budget could 'exacerbate' 76% pension lump sum withdrawal rate

AJ Bell has called on chancellor John Healey to commit to a pension tax lock

clock 06 October 2026 • 2 min read
Rachel Vahey: Pension savers need stability, not another panic-fuelled tax raid

Rachel Vahey: Pension savers need stability, not another panic-fuelled tax raid

'Real-world consequences of allowing pension tax speculation to run unchecked'

Rachel Vahey
clock 05 October 2026 • 3 min read