Regarding wood movement:
Depending on the wood you use, where you live, and your own personal experience,y ou may want to allow more clearance.
This is what works for me.
I really dont allow for any movement at this stage. I know this sounds like trouble waiting to happen, but it works just fine for me. Even if we start off with a snug fit, we will still end up with a small gap around the perimeter. This is due to the final sanding and easing of the edges between lid and lip. Feel free to start off with a small gap (1/16) or so if you wish. But keep in mind that as you sand your mating edges, that its very easy to get a sloppy fit. This would allow the lid to move from side to side, which will just feel wrong, and the pins may show too much in the gap, and the handle may not drop straight into the seat, and the sides may rub on the way down.
Cutting the lid to size is nothing more than cutting a rectangle exactly the size of the opening and then radiusing the corners.
Here is the lid blank cut to size and prior to rounding the corners…obviously.
I choose to sand the corners to match the profile of the box using a template to first mark out the radius. I bought a set of cool templates at Woodcraft.
Then its over to the disc sander to get close but leaving enough to fiddle with by hand.
OR you can make a template for the entire top out of ply or masonite or…well you get the picture. With a template you can stick it to your lid and run it around a router with a template bit. It may want to eat a corner or two, thats why I prefer to sand to fit. Just go slowly. Turn down the Rap music and pay attention at this point anyway.
The lid all snug in its new home.
-- If I can do it, so can you.