Pension Tax-Free Lump Sum Calculator
Estimate eligible pension commencement cash using the amount being crystallised and your remaining allowances. This does not calculate tax on a full pension withdrawal.
Rule year: 2026/27 · GBP · Sources checked
Illustrative maximum tax-free pension commencement lump sum
Eligible pension commencement lump sum, correct scheme entitlement and access conditions already established. Remaining allowances incorporate protections, earlier crystallisations and any transitional certificate. No UFPLS, serious-ill-health payment, death benefit, age eligibility, scheme-specific protected cash calculation or tax on later pension income.
For informational purposes only. This estimate is not financial advice, a tax return, a payroll calculation or a lender decision. See the supported circumstances and exclusions below.
How this calculator works
An eligible pension commencement lump sum is usually limited to 25% of the relevant crystallised amount and the remaining lump sum allowances. The standard starting Lump Sum Allowance is £268,275 and the standard Lump Sum and Death Benefit Allowance £1,073,100, but protections and earlier benefits can change your remaining figures. This tool uses the amounts you have already established and shows the crystallised amount left to provide pension income. That remaining amount is not assumed to be an immediate taxable cash withdrawal.
Formula and rules
Illustrative eligible PCLS = min(25% × relevant crystallised amount, remaining Lump Sum Allowance, remaining Lump Sum and Death Benefit Allowance).
Assumptions and limitations
Eligible pension commencement lump sum, correct scheme entitlement and access conditions already established. Remaining allowances incorporate protections, earlier crystallisations and any transitional certificate. No UFPLS, serious-ill-health payment, death benefit, age eligibility, scheme-specific protected cash calculation or tax on later pension income.
Worked example
Crystallising £400,000 with standard unused allowances gives a £100,000 illustrated PCLS. £300,000 remains for pension income and £168,275 of Lump Sum Allowance remains.
- Illustrative maximum tax-free pension commencement lump sum
- £100,000.00
- Crystallised amount remaining for pension income
- £300,000.00
- Remaining Lump Sum Allowance after this cash
- £168,275.00
- Remaining Lump Sum and Death Benefit Allowance
- £973,100.00
Official sources and review
Reviewed against the sources below on 2026-10-06. Rates are held in versioned rule modules. Versioned rules, official source review and year-specific calculation tests.
- HMRC: individual lump sum allowances ↗
Standard LSA £268,275 and LSDBA £1,073,100; use established remaining allowances and correct benefit type.
- GOV.UK: pension annual allowance ↗
£60,000 standard allowance; taper requires threshold income above £200,000 and adjusted income above £260,000.
Common questions
Is the £268,275 limit per pension pot?
The standard allowance applies across relevant pensions, not separately to each pot. Earlier benefits can use some of it.
Is the remaining crystallised amount paid out immediately?
Not necessarily. It remains available to provide pension income under the chosen arrangement. This page does not assume a full cash withdrawal.
Can I use the defaults if I took pension benefits before 2024?
Not without checking remaining allowances and transitional rules. Enter independently established amounts rather than assuming unused standard limits.