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Regulation 8 Requirements to be satisfied by transferee schemes, annuities etc.

England, Wales and Scotland

F1(1)

For the purpose of section 74(3)(a) (discharge of liability to or in respect of a member by the acquisition of transfer credits under another occupational pension scheme), the requirements to be satisfied by the other occupational pension scheme are the same as those which would apply by virtue of—

(a)

section 95(2)(a) of the Pension Schemes Act 1993 (ways of taking right to cash equivalent) if—

(i)

the member were entitled to a cash equivalent under Chapter IV of Part IV of that Act in respect of the rights liability in respect of which is being discharged, and

(ii)

he required his cash equivalent to be used to acquire transfer credits allowed under the rules of the scheme; or

(b)

section 101F(2)(a) of that Act (power to give transfer notice).

(2)

For the purpose of section 74(3)(b) (discharge of liability to or in respect of a member by the acquisition of rights under a personal pension scheme), the requirements to be satisfied by the personal pension scheme are the same as those which would apply by virtue of—

(a)

section 95(2)(b) of the Pension Schemes Act 1993 if the member were so entitled and he required his cash equivalent to be used to acquire rights allowed under the rules of the scheme; or

(b)

section 101F(2)(a) of that Act.

(3)

For the purpose of section 74(3)(c) (discharge of liability to or in respect of a member by the purchase of one or more annuities) the requirements to be satisfied by the annuities are the same as those which would apply by virtue of—

(a)

section 95(2)(c) of the Pension Schemes Act 1993 if the member were so entitled and he required his cash equivalent to be used to purchase annuities from such insurance companies as are mentioned in that section; or

(b)

section 101F(2)(b) of that Act, other than the requirement that an insurance company must be chosen by the member.

(4)

For the purpose of section 74(3)(d) (discharge of liability to or in respect of a member by subscribing to other pension arrangements satisfying prescribed requirements) the discharge of a liability to or in respect of a member may be provided for by transferring to him, or to any person who is entitled to benefits in respect of him, the benefit—

(a)

of one or more contracts to provide annuities which—

(i)

satisfy the requirements mentioned in paragraph (3); and

(ii)

are provided by insurance companies which consent to the transfer; or

(b)

of one or more policies of insurance which satisfy the requirements mentioned in section 19(4) of the Pension Schemes Act 1993 M1 (appropriate policies and annuity contracts).

(5)

For the purpose of section 74(3)(d), the discharge of a liability to or in respect of a member of a F2scheme that was a contracted-out scheme may also be provided for in a case where sub-paragraph (3B) of paragraph 5 of Schedule 2 to the Pension Schemes Act 1993 M2 applies by a payment to the Secretary of State of the amount mentioned in paragraph (b) of that sub-paragraph (amount required for restoring the member’s State scheme rights) if—

(a)

the member has duly made such an application as is required for the restoration of his State scheme rights in accordance with that provision, or

(b)

in a case where such an application may be made by the trustees or managers, they have duly made such an application;

and in this paragraph “State scheme rights" has the same meaning as in that sub-paragraph.

F3(6)

For the purposes of section 74(3)(e) (liabilities treated as discharged where the trustees have provided for them to be discharged by the payment of a cash sum in circumstances where prescribed requirements are met), the circumstances which are prescribed are—

(a)

where the payment is a contribution refund under F4Chapter 2 of Part 4ZA of the 1993 Act; or

(b)

where the payment—

(F5i)

of a lump sum—

(aa)

that is a trivial commutation lump sum F6, an uncrystallised funds pension lump sum or a winding up lump sum for the purposes of Part 1 of Schedule 29 to the Finance Act 2004 is made to a member; or

(bb)

is made by a registered pension scheme (within the meaning given in section 150(2) of the Finance Act 2004 (meaning of “pension scheme”)), is a payment that is described in Part 2 of the Registered Pension Schemes (Authorised Payments) Regulations 2009 and is made to or in respect of a member; and

(ii)

does not contravene any trivial commutation restriction that applies in the circumstances in question.

(7)

In this regulation “trivial commutation restriction” means a restriction imposed by—

(F7a)

regulation 18 or 25 of the Occupational Pension Schemes (Schemes that were Contracted-out) (No.2) Regulations 2015 (payment of a lump sum instead of a pension);

(b)

regulation 2 of the Occupational Pension Scheme (Assignment, Forfeiture, Bankruptcy etc. ) Regulations 1997 (commutation of a pension under an occupational pension scheme); F8 ...

(c)

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

(8)

Before 6th April 2006 this regulation applies with the modification in paragraph (9).

(9)

For paragraph (6)(b)(i) substitute—

“(i)

extinguishes the whole or part of the person’s entitlement to benefits under the scheme;

(ia)

does not contravene Revenue restrictions; and”.

(10)

For the purposes of this regulation a payment does not contravene Revenue restrictions if—

(a)

in the case of a scheme that is an approved scheme for the purposes of Chapter 1 of Part 14 of the Income and Corporation Taxes Act 1988 (see section 612(1) of that Act), it is permitted under the scheme rules in accordance with its approval for those purposes; and

(b)

in the case of a scheme that is a relevant statutory scheme for those purposes (see section 611A of that Act), it is permitted under the regulations or rules governing the scheme as such a scheme.

Annotations

Textual amendments

F1

Regs. 8(1)-(3) substituted (1.12.2000) by The Pension Sharing (Consequential and Miscellaneous Amendments) Regulations 2000 (S.I. 2000/2691), regs. 1, 3(4)

F2

Words in reg. 8(5) inserted (6.4.2016) by The Pensions Act 2014 (Abolition of Contracting-out for Salary Related Pension Schemes) (Consequential Amendments and Savings) Order 2016 (S.I. 2016/200), arts. 1(2), 9(2)(a)

F3

Reg. 8(6) to (10) added (6.4.2005) by Occupational Pension Schemes (Winding Up etc.) Regulations 2005 (S.I. 2005/706), regs. 1(2), 11 (with reg. 1(3))

F4

Words in reg. 8(6)(a) substituted (6.4.2016) by The Pension Protection Fund and Occupational and Personal Pension Schemes (Miscellaneous Amendments) Regulations 2016 (S.I. 2016/294), regs. 1, 2(3)(a)

F5

Reg. 8(6)(b)(i) substituted (1.12.2009) by Occupational and Personal Pension Schemes (Authorised Payments) Amendment Regulations 2009 (S.I. 2009/2930), regs. 1, 6

F6

Words in reg. 8(6)(aa)(b)(i) inserted (6.4.2016) by The Pension Protection Fund and Occupational and Personal Pension Schemes (Miscellaneous Amendments) Regulations 2016 (S.I. 2016/294), regs. 1, 2(3)(b)

F7

Reg. 8(7)(a) substituted (6.4.2016) by The Pensions Act 2014 (Abolition of Contracting-out for Salary Related Pension Schemes) (Consequential Amendments and Savings) Order 2016 (S.I. 2016/200), arts. 1(2), 9(2)(b)

F8

Reg. 8(7)(c) and preceding word omitted (6.4.2009) by virtue of Occupational, Personal and Stakeholder Pensions (Miscellaneous Amendments) Regulations 2009 (S.I. 2009/615), regs. 1(2), 9(2)(b)

Marginal citations

M1

1993 c. 48.

M2

Sub-paragraphs (3A) to (3E) were inserted in paragraph 5 of Schedule 2 by section 141(2) of the Pensions Act 1995 (c. 26).