OpenLegislation

Paragraph 1 C1C2C3C4

United Kingdom

C5(1)

For the purposes of this Part a lump sum is a pension commencement lump sum if—

F1(a)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F2(aa)

the member becomes entitled to it in connection with becoming entitled to a relevant pension (or dies after becoming entitled to it but before becoming entitled to the relevant pension in connection with which it was anticipated that the member would become entitled to it),

(b)

it is paid when all or part of the member’s F3lump sum allowance is available, and all or part or the member’s lump sum and death benefit allowance is available (see paragraph 12A),

(c)

it is paid within the period F4beginning six months before, and ending one year after, the day on which the member becomes entitled to it F5, and

(d)

it is paid when the member has reached normal minimum pension age (or the ill-health condition is satisfied),

F6(e)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . F7...

(f)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2)

But if a lump sum falling within sub-paragraph (1) exceeds the permitted maximum, the excess is not a pension commencement lump sum.

(3)

A pension is a relevant pension if—

(a)

it is income withdrawal, a lifetime annuity or a scheme pension, and

(b)

the member becomes entitled to it F8... F9under the pension scheme under which the member becomes entitled to the lump sum.

F10(3A)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F11(4)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F12(4A)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5)

Paragraph 2 defines the permitted maximum.

F13(6)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Annotations

Textual amendments

F1

Sch. 29 para. 1(1)(a) omitted (with effect in accordance with Sch. 16 paras. 85, 101 of the amending Act) by virtue of Finance Act 2011 (c. 11), Sch. 16 para. 24(2)(a)

F2

Sch. 29 para. 1(1)(a)(aa) substituted (retrospective to 6.4.2006) for Sch. 29 para. 1(1)(a) by Finance Act 2007 (c. 11), Sch. 20 paras. 11(2)(a), 24(3)

F3

Words in Sch. 29 para. 1(1)(b) substituted (for the tax year 2024-25 and subsequent tax years) by Finance Act 2024 (c. 3), Sch. 9 paras. 26(2)(a)(i), 124 (with Sch. 9 paras. 125-132A) (as amended by S.I. 2024/356, regs. 1, 4; and (18.11.2024 for the tax year 2024-25 and subsequent tax years) by S.I. 2024/1012, regs. 1(2)(3), 17)

F4

Words in Sch. 29 para. 1(1)(c) substituted (retrospective to 6.4.2006) by Finance Act 2007 (c. 11), Sch. 20 paras. 11(2)(b), 24(3)

F5

Word in Sch. 29 para. 1(1)(c) inserted (24.5.2024) by Finance (No. 2) Act 2024 (c. 12), s. 24(6)(a)

F6

Words in Sch. 29 para. 1(1)(e) omitted (retrospective to 6.4.2006) by virtue of Finance Act 2007 (c. 11), Sch. 20 paras. 11(2)(c), 24(3)

F7

Sch. 29 para. 1(1)(f) and preceding word omitted (24.5.2024) by virtue of Finance (No. 2) Act 2024 (c. 12), s. 24(6)(b)

F8

Words in Sch. 29 para. 1(3)(b) omitted (with effect in accordance with Sch. 16 paras. 85, 101 of the amending Act) by virtue of Finance Act 2011 (c. 11), Sch. 16 para. 79(2)

F9

Words in Sch. 29 para. 1(3)(b) substituted (6.4.2006) by Finance Act 2005 (c. 7), Sch. 10 paras. 34(2), 64(1)

F10

Sch. 29 para. 1(3A) omitted (for the tax year 2024-25 and subsequent tax years) by virtue of Finance Act 2024 (c. 3), Sch. 9 paras. 26(2)(b), 124 (with Sch. 9 paras. 125-132A) (as amended by S.I. 2024/356, regs. 1, 4; and (18.11.2024 for the tax year 2024-25 and subsequent tax years) by S.I. 2024/1012, regs. 1(2)(3), 17)

F11

Sch. 29 para. 1(4) omitted (for the tax year 2024-25 and subsequent tax years) by virtue of Finance Act 2024 (c. 3), Sch. 9 paras. 26(2)(b), 124 (with Sch. 9 paras. 125-132A) (as amended by S.I. 2024/356, regs. 1, 4; and (18.11.2024 for the tax year 2024-25 and subsequent tax years) by S.I. 2024/1012, regs. 1(2)(3), 17)

F12

Sch. 29 para. 1(4A) omitted (24.5.2024) by virtue of Finance (No. 2) Act 2024 (c. 12), s. 24(6)(c)

F13

Sch. 29 para. 1(6) omitted (for the tax year 2024-25 and subsequent tax years) by virtue of Finance Act 2024 (c. 3), Sch. 9 paras. 26(2)(b), 124 (with Sch. 9 paras. 125-132A) (as amended by S.I. 2024/356, regs. 1, 4; and (18.11.2024 for the tax year 2024-25 and subsequent tax years) by S.I. 2024/1012, regs. 1(2)(3), 17)

Modifications

C1

Sch. 29 para. 1 modified (6.4.2006) by The Taxation of Pension Schemes (Transitional Provisions) Order 2006 (S.I. 2006/572), arts. 1(1), 28; (as amended (18.11.2024 for the tax year 2024-25 and subsequent tax years) by S.I. 2024/1012, regs. 1(2)(3), 25(18))

C2

Sch. 29 Pt. 1 modified (6.4.2006) by The Taxation of Pension Schemes (Transitional Provisions) Order 2006 (S.I. 2006/572), arts. 1(1), 25(1)(2)(4)

C3

Sch. 29 Pt. 1 applied (with modifications) (6.4.2006) by The Pension Protection Fund (Tax) Regulations 2006 (S.I. 2006/575), regs. 1, 11

C4

Sch. 29 para. 1 modified (27.7.2010) by Finance (No. 2) Act 2010 (c. 31), Sch. 3 para. 7

C5

Sch. 29 para. 1(1) modified (6.4.2006) by The Taxation of Pension Schemes (Transitional Provisions) Order 2006 (S.I. 2006/572), arts. 1(1), 18

Notes on Schedule 29

Modifications

C1

Sch. 29 modified (6.4.2006) by The Pensions Schemes (Application of UK Provisions to Relevant Non-UK Schemes) Regulations 2006 (S.I. 2006/207), regs. 1(1), 15 (as amended: (13/8/2009) by S.I. 2009/2047, regs. 1(1), 2-10; (with effect in accordance with reg. 1(3) of the amending S.I.) by S.I. 2012/1795, regs. 1(1), 6; (with effect in accordance with Sch. 1 para. 96(16)(a) of the amending Act) by 2014 c. 30, Sch. 1 para. 96(3)-(14) (with Sch. 1 para. 96(16)(b)); and (for the tax year 2024-25 and subsequent tax years) by 2024 c. 3, Sch. 9 paras. 62(6), 124 (with Sch. 9 paras. 125-132A) (as amended by S.I. 2024/356, regs. 1, 4); and (18.11.2024 for the tax year 2024-25 and subsequent tax years) by S.I. 2024/1012, regs. 1(2)(3), 22(2))

C2

Sch. 29 modified by The Taxation of Pension Schemes (Transitional Provisions) Order 2006 (S.I. 2006/572), art. 23C (as inserted (1.6.2009) by S.I. 2009/1172, arts. 1, 3 (as amended (with effect in accordance with s. 42(9) of the amending Act) by Finance Act 2014 (c. 26), s. 42(5); and by Taxation of Pensions Act 2014 (c. 30), Sch. 1 para. 72(1) (with Sch. 1 para. 72(2)(b)); and (18.11.2024 for the tax year 2024-25 and subsequent tax years) by S.I. 2024/1012, regs. 1(2)(3), 25(14))