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To LTA or not to LTA, that is the question
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From my experience I'm now hitting up against the LTA and kind of wish I'd maybe put more into ISA's 10 years ago....but I was more than happy getting the tax relief on the pensions at that time.
Thanks to these boards I only realised yesterday that the 55% will only apply to any excess above the LTA if I want it as a lump sum. Otherwise it will be taxed at 25%, so I'm a bit more relaxed about exceeding the limit if the markets do well over the next few years.1 -
If you are a 40% taxpayer in retirement , then you will also pay 55% even ( LTA + income tax ) if you take it as income .
If you are a 20% taxpayer you will lose 40% if you take it as income , so less of an issue, especially if you gained 40% tax relief on the way in .1
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