Tax allowances have shrunk 6% in the last decade - Quilter

‘Take advantage of the situation today’

Ayesha Venkataraman
clock • 2 min read

Six of the eight main UK tax allowances were found to be either frozen or decreased in the past decade, reducing by an average of 6%, according to analysis by Quilter.

When analysing the eight main UK tax allowances over the decade, Quilter found that the pensions annual allowance - the limit on how much money you can build up tax-free in your pension in any one tax year while still benefiting from tax relief - has shrunk by 20% from £50,000 to £40,000, while the lifetime allowance has dropped by 28% from £1.5m to £1.07m. Pension savers have also been hampered by a 60% reduction in the money purchase annual allowance, which was introduced in the 2015/16 tax year, from £10,000 to £4,000. Additionally, it found that the dividend allowance, which was o...

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 Your profession

Rise of the money coach

Rise of the money coach

Advice hurdles pose as push factors but plenty of pull factors too

Sophia Panayi
clock 30 June 2026 • 9 min read
Why advice gap progress may be on the horizon

Why advice gap progress may be on the horizon

'Three things appear to be moving the needle'

Will Dunwell
clock 30 June 2026 • 5 min read
Why accessibility is a must-have in a digital-first world

Why accessibility is a must-have in a digital-first world

Meeting the accessibility needs of vulnerable customers

Jonathan Hassell
clock 29 June 2026 • 4 min read