Transitional Tax Free Amount - specific case

LLB

Hi everyone

I'm hoping someone can help me to clarify how DB benefits taken pre 5/4/24 (but not before A Day) are valued for LSA/LSBDBA.

The client took the following benefits from their 1995 Section NHS pension in March 2021:

Tax-free lump sum: £18,897.54
Income: £6,299.18 per annum.

LTA % used is 10.7% (Individual Protection 2014 applies at £1,358,295).

The current provider is telling us that this equates to £36,334.39 LSA used.

This figure has been calculated by multiplying £1,358,295 x 10.7% and then x 25%.

• Is that the right process for valuing DB benefits taken pre 5/4/2024? Therefore the LSA used figure is correct?

Thank you for any help!

Calvert76

Yes, that's how the default calc works, however as actual cash taken is less you can apply for a transitional certificate

LLB

Thank you! So for the TTFAC, would we just use the actual monetary amount of the tax-free cash taken? ie £18,897.54?

les_cameron

@LLB said:
Thank you! So for the TTFAC, would we just use the actual monetary amount of the tax-free cash taken? ie £18,897.54?

Send the proof of benefits taken and you'll get the certificate back.

LLB

@les_cameron said:

@LLB said:
Thank you! So for the TTFAC, would we just use the actual monetary amount of the tax-free cash taken? ie £18,897.54?

Send the proof of benefits taken and you'll get the certificate back.

Thank you so much.