Paragraph 55 Declaration where lump sum payments are madeI1

After regulation H4 insert—

“Declaration where lump sum payments are made

H4A.

(1)

The Department may, before paying any lump sum under regulations E4A, E6, E6A, E19A, I3 or I5A require the person to whom the payment is to be made to provide a declaration as specified in paragraph (2) by a date determined by the Department.

(2)

The declaration is a declaration, in a form specified by the Department, signed by the person, to the effect that paragraph 3A of Schedule 29 to the Finance Act 2004^f1(recycling of lump sum) does not apply.

(3)

Where no such declaration is received by the Department by the date referred to in paragraph (1) —

(a)

where the payment in question would otherwise have been a lump sum under regulation E4A, E6A, or I5A, the Department may treat the election under regulation E4A, E6A or I5A as being of no effect,

(b)

where the payment in question would otherwise have been a lump sum under regulation E6, E31(16) or I3, the Department may, in place of the lump sum, pay an additional pension representing the value of the lump sum,

(c)

where the payment in question would otherwise have been a lump sum under regulation E19A, the Department need not pay the lump sum.

(4)

The amount of the additional pension referred to in paragraph (3)(b) shall be determined by the Department after taking advice from the Government Actuary.

Repayment of contributions where an election is not made under regulation G7

H4B.

(1)

This regulation applies where—

(a)

a person receives an increase in contributable salary as is mentioned in regulation E31(11), but

(b)

no election under regulation G7(2) has been made.

(2)

Where this regulation applies the Department shall repay—

(a)

to the person who was in pensionable employment a sum equivalent to A-B, and

(b)

to that person’s last employer before he became entitled to retirement benefits a sum equivalent to C-D.

(3)

In paragraph (2)—

• A is the aggregate of the contributions paid by the person under regulation C2 or C8 or Schedule 4 or 5,

• B is the aggregate of the contributions which would have been paid under regulation C2 or C8 or Schedule 4 or 5 during the relevant period if the person had actually received the salary which he was treated as having received under regulation E31(11),

• C is the aggregate of the contributions paid by the person’s employer under regulation G5 during the relevant period, and

• D is the aggregate of the contributions which would have been paid by the person’s employer under regulation G5 during the relevant period if the person had actually received the salary which he was treated as having received under regulation E31(11)

and in this paragraph the “relevant period” is the period which started when the person received the increase in contributable salary as mentioned in regulation E31(11) and ended when the person became entitled to the payment of retirement benefits.”.