The Government has issued a new Financial Bill which includes the legal mechanism for the abolition of the pensions Lifetime Allowance (LTA).

The new Finance Bill follows the Autumn Statement mini-Budget and includes full details of the new pension tax system to be introduced from April.

While abolishing the Lifetime Allowance, the Bill also introduces two new allowances.

A Lump Sum Allowance set at £268,275 is the maximum someone can take as a tax-free lump sum (unless they have protection). This is a quarter of the current £1,073,100 LTA.

A Lump Sum and Death Benefit Allowance, set at £1,073,100, incorporates both tax-free lump sums someone takes while alive and lump sums paid on death.

The Bill also includes transitional arrangements for those who have taken some benefits before 6 April, and how those are taken into account in working out how much allowance an individual has remaining.

Andrew Tully, technical services director at adviser platform Nucleus Financial, criticised the speed at which the Government is pushing forward the pension tax changes.

He said: “The complexity of these new rules reaffirms our view that we should take more time before introducing such a major change to legislation.

"We have around four months to change systems and literature, as well as communicate significant changes and their implications to customers and advisers. This is simply not feasible and is likely to result in poor customer outcomes.”