Lifetime Allowance - LSA and LSDBA

Simes122

if (say) one has managed to used up the majority of one's LSA but not all, but what is remaining is not sufficient to cover the balance in a DC pot.   For example, fake figures:

LSA £268,275 (at the moment)

LSA used: 220k, balance of LSA unused is 48,275.   If one still had say £250k uncrystallised in a DC pot, there would potentially be £67.5k tax free available if there were LSA to cover it.  But there is insufficient LSA remaining to cover that 67.5k. 

Is it the case that tax free available would simply be 48275, and the balance would be taxed at marginal rate?   Is it as simple as that?

A deeper question will depend on the October budget - if Labour change the LSA up or down, what happens then - potentially one could end up with more or less LSA at one's disposal?

MallyGirl

you could do 3 transfers of £10k to make use of the small pots rule - gains you another £7,500 tax free

Simes122

MallyGirl said:

you could do 3 transfers of £10k to make use of the small pots rule - gains you another £7,500 tax free

Ooh good thinking!!!   I'm with USS so I'm not sure that's possible without transferring my DC pot out, but it's something I'll look into!