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Transitional Tax Free Amount - specific case

LLBLLB Member
in Technical stuff

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!

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Comments

  • Calvert76Calvert76 Member
    Yes, that's how the default calc works, however as actual cash taken is less you can apply for a transitional certificate
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  • LLBLLB Member

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

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  • les_cameronles_cameron Member

    @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.

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  • LLBLLB Member

    @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.

    Share on Google+
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