Regulation 5 Amendment of regulation C1I1

Regulation C1 (meaning of pensionable pay and final year’s pensionable pay) is amended as follows.

After paragraph (1) insert—

“(1A)

Paragraphs (2) to (4) and (5) to (7) apply in respect of pensionable employment before 1st April 2008.”.

After paragraph (4) insert—

“(4A)

Paragraphs (4B) to (7) apply in respect of pensionable employment on, or after, 1st April 2008.

(4B)

Subject to paragraph (4C), pensionable pay in excess of the permitted maximum will not be ignored.

(4C)

Pensionable pay in excess of the permitted maximum will be ignored in respect of additional service being bought under regulation Q1 and an unreduced lump sum being brought under regulation Q2 if—

(a)

the member elected to make such a purchase under regulation Q6(3) from a birthday falling before 1st April 2008; and

(b)

the member’s pensionable pay was restricted under paragraph (2) of this regulation before that date; or

(c)

the member’s pensionable pay would have been restricted under that paragraph if it had exceeded the permitted maximum.”.

In paragraph (6) for “In these”, substitute “Subject to paragraph (6A), in these”.

After paragraph (6) insert—

“(6A)

If the pensionable pay of a member credited with a period of pensionable service under regulation N2 (transfers made under the Public Sector Transfer Arrangements) or regulation N4 (special terms for transfers in (bulk transfers etc)) has exceeded the permitted maximum and either—

(a)

paragraph 20 of Schedule 6 to the Finance Act 1989^f1 applied to the member without the modification made by regulation 5 of the Retirement Benefits Schemes (Continuation of Rights of Members of Approved Schemes) Regulations 1990^f2 in respect of benefits derived from all or part of that service under another scheme; or

(b)

any equivalent scheme provision applied to the member in respect of all or part of that service when that person was a member of the scheme from which the transfer was accepted,

that excess shall be ignored for the purposes of calculating the final year’s pensionable pay under paragraph (6) in respect of the corresponding period of pensionable service credited under regulation N2 or N4.”.

For paragraph (7) substitute—

“(7)

In this regulation, “permitted maximum” means—

(a)

in relation to any tax year before the tax year 2006-07, the figure specified for that tax year in an order made under section 590C of the Income and Corporation Taxes Act 1988; or

(b)

subject to paragraphs (8) and (9), the figure for any later year is £108,600.

(8)

If the retail prices index for the month of September preceding the tax year 2007-08 or any later tax year is higher than it was for the previous September, the figure for that year shall be an amount arrived at by—

(a)

increasing the figure for the previous tax year by the same percentage as the percentage increase in the retail prices index; and

(b)

if the result is not a multiple of £600, rounding it up to the nearest amount which is such a multiple.

(9)

If the retail prices index for the month of September preceding the tax year 2007-08 or the month of September preceding any later tax year is not higher than it was for the previous September, the figure for that year shall be the same as for the previous tax year.”.