- When you have accessed your pension flexibly you cannot contribute as much as the usual annual allowance to your pension
- This limit will increase on 6 April but still remains significantly below the maximum annual allowance
- We look at what triggers it and what your options are
In the Spring Budget, chancellor Jeremy Hunt abolished the pensions lifetime allowance and announced meaningful increases to both the annual allowance and the money purchase annual allowance (MPAA), in a bid to reduce economic inactivity among the over 50s. Although the least known of these three limits, the MPAA can have significant consequences for your retirement planning, so it’s worth knowing how it works and how you can avoid triggering it if you need to access a portion of your pension savings.