The total annual amount that can be saved by you (and by the company on your behalf) in all Registered pension schemes. Any excess contributions over the Annual Allowance will be subject to tax.
| Tax Year | Annual Allowance |
| 2008/09 | £235,000 |
| 2009/10 | £245,000 |
| 2010/11 | £255,000 |
In addition, the Annual Allowance does not apply in the year you actually start to receive your benefits.
These are similar to government bonds, but they are issued by non-government agencies and companies. Interest is paid at a fixed rate over the term of the bond and a capital sum is repaid at the end of the term. Corporate bonds are rated by independent organisations according to their ability to be able to pay the interest payments and the capital at the end of the term. Investment grade bonds are those rated AAA, AA, A and BBB, with the highest rating AAA, followed by AA, A and BBB. Corporate bonds rated below this are known as sub-investment grade, high yield or "junk" bonds.
The Lifestyle Plan funds only invest in investment grade bonds rated AAA, AA and A. See the Investment Guide for further details.
Ordinary shares in companies ie "stockmarket investments". In the context of the Lifestyle Plan we usually mean investment in a pooled fund which comprises shares in a wide range of companies rather than shares in just one company. "UK equities" refers to pooled funds investing in companies quoted on the London Stock Exchange although most of these companies do have trading operations all over the world. Similarly each of the overseas regions (eg "Europe", "North America", etc) refers to the stock market grouping for the particular pooled fund.
This is the limit on the amount of pension that qualifies for tax relief. It applies to all of the benefits you build up over your entire working life across all pension schemes. If you build up benefits above the Lifetime Allowance, they will be subject to tax. (Individuals who had already built up large benefits before April 2006 were able to protect their rights).
| Tax Year | Lifetime Allowance |
| 2008/09 | £1.65 million |
| 2009/10 | £1.75 million |
| 2010/11 | £1.8 million |
State Pension Age ("SPA") is currently age 65 for men and age 60 for women. However, the Government had passed legislation to equalise SPA at age 65 for both men and women, starting from April 2010. This change will be phased in over a ten year period from this date and as a result the effect on a woman's SPA is as follows:
| DATE OF BIRTH | STATE PENSION AGE |
|---|---|
| ON OR BEFORE 5 APRIL 1950 | AGE 60 |
| FROM 6 APRIL 1950 TO 5 MARCH 1955 | Age 60 plus one month for every month your birthday falls after 5 April 1950 |
| ON OR AFTER 6 MARCH 1955 | AGE 65 |
This is the date you set for yourself to control the timing of the switching of your Lifestyle account from the Long Term Fund into the Short Term Fund. It does not mean you must retire at TRD. It is simply the way in which you can have personal control over your Lifestyle account in the years leading up to your expected retirement. You can change your TRD at any time to reflect your best estimate of when you think you may draw your benefits.
Remember that a change to your TRD could have an immediate impact on the way in which your account is invested.