Regulation 21 Disregard of certain small payments in determining PPF compensation capI1

For the purposes of paragraph 26 of Schedule 6 (compensation cap), in determining the restriction under that paragraph on the compensation to which a person is entitled in respect of a benefit under a scheme, a lump sum within sub-paragraph (6B)(b) of that paragraph (lump sums to which the person has previously become entitled) is to be disregarded if –

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

Before 6th April 2006 this regulation applies with the modifications in paragraphs (4) and (5).

For paragraph (1)(a) there shall be substituted –

“(a)

it extinguishes the person’s entitlement to benefits under the scheme,

(aa)

its payment does not contravene Inland Revenue restrictions, and”.

After paragraph (2) there shall be inserted –

“(3)

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

(a)

in the case of a scheme that is an approved scheme for the purposes of Chapter I of Part XIV of the Income and Corporation Taxes Act 1988^f5 (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^f6), it is permitted under the regulations or rules governing the scheme as such a scheme.”.