Workers are often chastised for not saving enough for retirement, but fines lie in wait for the tens of thousands who save too much.
The government sets a limit on the amount anyone can save in pensions for retirement.
The magic figure is £1.03 million, which will rise in line with inflation to £1.055 from April 6.
The technical name for this cap on retirement saving is the lifetime allowance.
Around 290,000 retirement savers have already put aside more than the lifetime allowance limit in their pensions, according to data from pension provider Royal London.
They face fines of up to 55% of their savings above the lifetime allowance level.
1.5 million pension at risk
The rate has seen cuts three times since 2010, and each time savers could apply for protection to stave off penalties – but fewer than half of savers are thought to have applied for the safeguard.
And many are still adding to their pension wealth by stashing more money into their pensions.
The company says the research also found another 1.5 million workers are likely to have savings that breach the lifetime allowance limit when they retire.
Most are well-paid public sector workers who have seen their retirement age stretch from 60 to 65 years old or workers with defined contribution pensions who have employers contributing to their retirement savings.
These workers probably fall into the £60,000 a year to £90,000 a year earnings band.
“This research shows how drastic cuts in the Lifetime Allowance mean that large numbers of workers will be caught by a limit that was originally only designed for the super-rich,” said former pensions minister and Royal London director of policy Steve Webb.
“It is shocking that over 250,000 people have already breached the lifetime allowance and that many of these are still adding to their pensions. They are likely to get a nasty shock – and a big tax bill – when they do finally draw their pensions.
“This is truly a lifetime allowance timebomb. Many workers, especially those in defined benefit pension schemes, will have little idea that this is an issue and could be heading for a nasty jolt. The government needs to think hard about how to make sure people are aware of these limits in time to make alternative arrangements, and individuals need to take expert advice if they are to avoid potentially huge tax bills.”