# Income Tax (Earnings and Pensions) Act 2003, Section 637D: Uncrystallised funds pension lump sums


(1) Subject to subsection (2), where an uncrystallised funds pension lump sum is paid under a registered pension scheme—
(a) no liability to income tax arises on 25% of the lump sum, and
(b) section 579A (pensions) applies in relation to the remainder of the lump sum as it applies to any pension under a registered pension scheme.
(2) If—
(a) an uncrystallised funds pension lump sum is paid under a registered pension scheme, and
(b) 25% of the lump sum is an amount that exceeds the permitted maximum,
section 579A (pensions) applies to the excess as it applies to any pension under a registered pension scheme.
(3) In subsection (2) “the permitted maximum”, in relation to an uncrystallised funds pension lump sum paid to a member, means the lower of the following amounts—
(a) so much of the member’s lump sum allowance as is available on the member becoming entitled to the lump sum (see section 637Q);
(b) so much of the member’s lump sum and death benefit allowance as is available on the member becoming entitled to the lump sum (see section 637S).

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Source: https://www.legislation.gov.uk/ukpga/2003/1/section/637D (the official version)
Page: https://openlegislation.uk/income-tax-earnings-and-pensions-act-2003/section-637D
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.