Two-year freeze on lifetime allowance could be extended in Autumn Statement
A stealth tax raid on pensions will cost savers as much as £260,000 in lost allowances by 2028, as the Government scrambles to plug a black hole in public finances.
Chancellor Jeremy Hunt is expected to announce a further two-year freeze on the lifetime allowance on pension savings in the Autumn Statement on Thursday.
The extended freeze, which will keep the cap fixed at £1.073m until 2028, will mean that savers will be able to build almost £260,000 less in their pensions before being taxed, compared with a threshold that moved in line with inflation.
If the current lifetime allowance increased in line with rising costs, it would be £1.332m by the 2027-28 tax year, according to estimates by the broker AJ Bell. Over the course of the next six years that would represent a difference of £258,000, it found.