Finance Bill 2025-26 Report Stage Explanatory Notes
Summary
HM Revenue & Customs has published explanatory notes and tax information for government amendments to the Finance Bill 2025-26 at its report stage. These notes detail changes related to the abolition of the Lifetime Allowance and tax implications for certain pension interests and umbrella companies.
What changed
HM Revenue & Customs (HMRC) has released explanatory notes and tax information impacting the Finance Bill 2025-26 during its report stage. The documents detail government amendments concerning the abolition of the Lifetime Allowance, including powers for further regulations, and specific tax treatments for pension interests, particularly relating to withholding benefits and administrator payment responsibilities. Amendments also address tax charges on certain pension interests and liability for these taxes, as well as changes related to umbrella companies.
These notes are crucial for understanding the practical implications of the proposed legislative changes for individuals and businesses involved with pensions and employment structures. Tax professionals, employers, and pension scheme administrators should review these amendments to ensure compliance with the evolving tax landscape. While specific compliance deadlines are not detailed in this publication, the effective date of the Finance Bill will dictate when these changes come into force, necessitating timely review and potential adjustments to internal policies and procedures.
What to do next
- Review amendments to the Finance Bill 2025-26 concerning Lifetime Allowance, pension interests, and umbrella companies.
- Assess the impact of these changes on pension scheme administration and tax liabilities.
- Update internal policies and guidance for affected employees and employers.
Source document (simplified)
Policy paper
Finance Bill 2025-26: Report Stage
Explanatory Notes and Tax Information and Impact Note for government amendments in Report Stage of Finance Bill 2025-26.
From: HM Revenue & Customs Published 9 March 2026 Get emails about this page
Documents
Abolition of Lifetime Allowance — amendment of power to make further regulations
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Amendment 14 to clause 24: umbrella companies
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Amendments 15 to 17 to clause 63: tax to be charged on certain pension interests
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Amendments 18 to 20 to clause 64: liability for tax on pension interests
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Amendments 21 to 30 to clause 65: withholding of benefits and payment of tax by pension scheme administrator
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Amendments 31 to 33 to clause 66: connected amendments to Inheritance Tax Act 1984
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Amendments 34 to 47 to clause 67: connected amendments to income tax rules
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Amendments 48 to 52 to clause 43 and schedule 3: non-resident, and previously non-domiciled individuals
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Amendments 54 to 66 to clause 62 and schedule 12: agricultural property relief and business property relief
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New clause 5: offshore income gains
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New clause 6: offshore income gains: savings
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New clause 7: Lifetime Allowance abolition — amendment of power to make further regulations
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Details
The government tabled the following amendments for the Report Stage of Finance Bill 2025-26, that need the following updated explanatory notes and tax information and impact note:
- Abolition of Lifetime Allowance — amendment of power to make further regulations
- Amendment 14 to clause 24: umbrella companies
- Amendments 15 to 17 to clause 63: tax to be charged on certain pension interests
- Amendments 18 to 20 to clause 64: liability for tax on pension interests
- Amendments 21 to 30 to clause 65: withholding of benefits and payment of tax by pension scheme administrator
- Amendments 31 to 33 to clause 66: connected amendments to Inheritance Tax Act 1984
- Amendments 34 to 47 to clause 67: connected amendments to income tax rules
- Amendments 48 to 52 to clause 43 and schedule 3: non-resident, and previously non-domiciled individuals
- Amendments 54 to 66 to clause 62 and schedule 12: agricultural property relief and business property relief
- New clause 5: offshore income gains
- New clause 6: offshore income gains: savings
- New clause 7: Lifetime Allowance abolition — amendment of power to make further regulations
Updates to this page
Published 9 March 2026
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