Section 172 AssignmentI1

United Kingdom

(1)

Subsection (2) applies if a member of a registered pension scheme (or the member’s personal representatives) assigns or agrees to assign

F1(a)

any benefit, other than an excluded pension, to which the member (or any dependantF2, nominee or successor of the member) has an actual or prospective entitlement under the pension scheme, or

(b)

any right in respect of any sums or assets held for the purposes of any arrangement under the pension scheme.

(2)

Unless the assignment or agreement is pursuant to a pension sharing order or provision, the pension scheme is to be treated as making an unauthorised payment to the member (or to the member’s personal representatives in respect of the member).

(3)

Subsection (4) applies if a person (or a person’s personal representatives) assigns or agrees to assign

F3(a)

any benefit, other than an excluded pension, to which the person has F4a prospective entitlement under the pension scheme in respect of a member of the pension scheme, or

(b)

any right in respect of any sums or assets held for the purposes of any arrangement relating to F5a member of the pension scheme under the pension scheme.

(4)

Unless the assignment or agreement is pursuant to a pension sharing order or provision, the pension scheme is to be treated as making an unauthorised payment to the person (or the person’s personal representatives) in respect of the member.

(5)

The amount of the unauthorised payment is the greater of—

(a)

the consideration received in respect of the assignment or agreement, and

(b)

the consideration which might be expected to be received in respect of the assignment or agreement if the parties to the transaction were at arm’s length F6 and any power to reduce the entitlement to the benefit or right did not exist.

(6)

Where a pension scheme is treated by this section as having made an unauthorised payment in relation to an assignment (or an agreement to assign), payments by the pension scheme of the benefit F7or right assigned (or agreed to be assigned) are not unauthorised payments.

F8(6A)

References in this section to a benefit to which the member or a person has an entitlement under the pension scheme includes rights to payments under—

(a)

a scheme pension or dependants' scheme pension provided by the scheme administrator or as a result of the application of sums or assets held for the purposes of the pension scheme, or

(b)

a lifetime annuity or dependants' annuityF9, or nominees' annuity or successors' annuity, purchased by the application of sums or assets held for the purposes of the pension scheme.

F10(7)

An excluded pension is so much of any pension which under pension rule 2 may continue to be paid after the member's death as may be so paid.

(8)

“Assignment” includes assignation and related expressions are to be read accordingly.

Annotations

Textual amendments

F1: S. 172(1)(a)(b) substituted for words (6.4.2006) by Finance Act 2005 (c. 7), Sch. 10 paras. 37(2), 64(1)
F2: Words in s. 172(1)(a) inserted (17.12.2014) by Taxation of Pensions Act 2014 (c. 30), Sch. 2 para. 5
F3: S. 172(3)(a)(b) substituted for words (6.4.2006) by Finance Act 2005 (c. 7), Sch. 10 paras. 37(3), 64(1)
F4: Word in s. 172(3)(a) substituted (21.7.2008) (with effect in accordance with Sch. 28 para. 15(1) of the amending Act) by Finance Act 2008 (c. 9), Sch. 28 para. 2(2)(a)
F5: Words in s. 172(3)(b) substituted (21.7.2008) (with effect in accordance with Sch. 28 para. 15(1) of the amending Act) by Finance Act 2008 (c. 9), Sch. 28 para. 2(2)(b)
F6: Words in s. 172(5)(b) inserted (6.4.2006) by Finance Act 2005 (c. 7), Sch. 10 paras. 37(4), 64(1)
F7: Words in s. 172(6) inserted (6.4.2006) by Finance Act 2005 (c. 7), Sch. 10 paras. 37(5), 64(1)
F8: S. 172(6A) inserted (21.7.2008) (with effect in accordance with Sch. 28 para. 15(1) of the amending Act) by Finance Act 2008 (c. 9), Sch. 28 para. 2(3)
F9: Words in s. 172(6A)(b) inserted (26.3.2015) by Finance Act 2015 (c. 11), Sch. 4 para. 8
F10: S. 172(7) substituted (6.4.2006) by Finance Act 2005 (c. 7), Sch. 10 paras. 37(6), 64(1)

Commencement

I1: Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

Notes on Part 4

Modifications

C1: Pt. 4 modified (N.I.) (1.4.2006) by The Firemens Pension Scheme Order (Northern Ireland) 2006 (S.R. 2006/210), arts. 1(2), 103
C2: Pt. 4 modified (6.4.2006) by The Pension Protection Fund (Tax) Regulations 2006 (S.I. 2006/575), regs. 1, 9, 10
C3: Pt. 4 modified (6.4.2006) by The Pension Protection Fund (Tax) Regulations 2006 (S.I. 2006/575), regs. 1, 12
C4: Pt. 4 modified (6.4.2006) by The Pension Protection Fund (Tax) Regulations 2006 (S.I. 2006/575), regs. 1, 13(5)
C5: Pt. 4 modified (6.4.2006) by The Pension Protection Fund (Tax) Regulations 2006 (S.I. 2006/575), regs. 1, 26
C6: Pt. 4 modified (31.12.2007) by Police and Justice Act 2006 (c. 48), s. 53(1), Sch. 3 para. 7; S.I. 2007/3203, art. 3(b)
C7: Pt. 4 modified (1.7.2008) (N.I.) (with effect in accordance with reg. 1 of the amending Rule) by The Health and Social Care (Pension Scheme) Regulations (Northern Ireland) 2008 (S.R. 2008/256), regs. 1, 124(1) (with regs. 134, 258)
C8: Pt. 4 modified by The Taxation of Pension Schemes (Transitional Provisions) Order 2006 (S.I. 2006/572), reg. 5A (as inserted (6.4.2006) by S.I. 2008/2990, arts. 1(1), 3)
C9: Pt. 4 applied (21.7.2009) by Finance Act 2009 (c. 10), Sch. 35 para. 18
C10: Pt. 4 modified (19.7.2011) by Finance Act 2011 (c. 11), Sch. 18 para. 14(3)
C11: Pt. 4 applied (with modifications) (with application in accordance with Sch. 22 para. 1 of the amending Act) by Finance Act 2013 (c. 29), Sch. 22 para. 1(2)
C12: Pt. 4 modified (17.7.2014) by Finance Act 2014 (c. 26), Sch. 6 para. 1(2)(3)
C13: Pt. 4: power to amend conferred (17.12.2014) by Taxation of Pensions Act 2014 (c. 30), s. 4(3)
C14: Pt. 4 modified (15.9.2016) by Finance Act 2016 (c. 24), Sch. 4 para. 1
C15: Pt. 4 modified (15.9.2016) by Finance Act 2016 (c. 24), Sch. 4 para. 9(2)
C16: Pt. 4 modified (with effect in relation to the tax year 2024-25 and subsequent tax years) by The MPs’, Senedd and Assembly Pension Schemes (Tax) Regulations 2025 (S.I. 2025/52), regs. 1(2)(3), 6
C17: Pt. 4 modified (14.7.2026 for the tax year 2014-15 and subsequent tax years) by The Public Service Pension Schemes (Rectification of Unlawful Discrimination) (Tax) Regulations 2026 (S.I. 2026/673), regs. 1(2), 10

Notes on Chapter 3

Modifications

C1: Pt. 4 modified (19.7.2011) by Finance Act 2011 (c. 11), Sch. 18 para. 14(3)
C2: Pt. 4 modified (with effect in relation to the tax year 2024-25 and subsequent tax years) by The MPs’, Senedd and Assembly Pension Schemes (Tax) Regulations 2025 (S.I. 2025/52), regs. 1(2)(3), 6