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TTFAC: when the certificate recovers £64,620 — and when it costs £35,380
The default assumes maximum tax-free cash was always taken. Evidence it was less and a certificate recovers allowance; evidence it was more and the certificate binds against you.
6 min read · Last reviewed
A member who crystallised benefits under the Lifetime Allowance does not start the new regime with a clean £268,275 Lump Sum Allowance. The transitional default deducts 25% of the LTA percentage they used — built on the assumption that every crystallisation took maximum tax-free cash. A Transitional Tax-Free Amount Certificate replaces that assumption with evidence: the scheme-documented tax-free amounts actually paid. The certificate is not an optimisation lever — it is a substitution of fact for assumption, and it binds whichever way the facts cut.
Case A — the default overstates; the certificate recovers
A member used 80% of the £1,073,100 LTA (£858,480 crystallised), much of it DB scheme pension where little tax-free cash was actually drawn — scheme statements evidence £150,000.
- Default deduction (25% × £858,480)
- £214,620
- LSA remaining on the default
- £53,655
- Evidenced deduction (actual TFC)
- £150,000
- LSA remaining with a TTFAC
- £118,275
- Recovered by the certificate
- £64,620
DB members are the classic winners: scheme pension crystallises LTA without proportionate tax-free cash, so the 25% assumption overstates what was taken.
PTM174000 — figures engine-computed against the 2026/27 config
Case B — same history, opposite answer
Now suppose the evidence shows £250,000 of tax-free cash — a scheme-specific protected PCLS that paid morethan 25%. The evidenced deduction (£250,000) exceeds the default (£214,620): remaining LSA falls from £53,655 to £18,275. A certificate here costs £35,380 of allowance — and once issued it cannot be unwound in favour of the default. Our engine's recommendation on these facts is to stay on the default; the TTFAC calculator runs both paths side by side before anyone applies.
The common errors
Three recur. Applying without computing both paths — the scheme-specific-PCLS reversal above. Missing the lock-in: the application must be made before the first post-April-2024 relevant crystallisation, after which the default is permanent, so the comparison belongs at the start of advice, not the end. And forgetting the LSDBA side: the certificate substitutes evidence for both allowances at once, and pre-75 serious ill-health and death-benefit events carry a 100% default, not 25% — a history containing one changes the LSDBA arithmetic dramatically.
PTM174000 (lock-in, evidence) · PTM174200 (LSDBA defaults)
Grounding & sources
- Worked case A (LTA used 80% = £858,480 → default deduction £214,620 → remaining £53,655; evidenced TFC £150,000 → remaining £118,275; uplift £64,620): computed through the production engine (calculateTTFAC; same render-time computation as /calculators/ttfac).
- Worked case B (same history, evidenced TFC £250,000 → remaining £18,275; uplift −£35,380; engine recommendation use_default): computed through the production engine (scripts/ground-phase-c.mts, 2026-06-10).
- Lock-in (apply before the first post-April-2024 RBCE) + evidence requirements: PTM174000. LSDBA-side defaults incl. 100% for pre-75 SIH/death events: PTM174200.
For planning and illustration purposes only. Verify all inputs against source documents. This explainer does not constitute financial or tax advice.