Schedule 29 - Registered pension schemes: authorised lump sums — supplementary

Part of Finance Bill – in a Public Bill Committee at 5:15 pm on 8th June 2004.

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Photo of Mr John McWilliam Mr John McWilliam Labour, Blaydon 5:15 pm, 8th June 2004

With this it will be convenient to discuss the following amendments:

No. 225, in

schedule 29, page 433, line 21, after 'scheme', insert

'together with interest at a prescribed rate,'.

No. 226, in

schedule 29, page 434, line 14, leave out paragraph 7 and insert—

'7. (1) For the purposes of this Part a lump sum is a trivial commutation lump sum if—

(a) on the nominated date, the value of the member's pension rights does not exceed the commutation limit,

(b) it is paid when all or part of the amount which is the individual's lifetime allowance in relation to the member is available,

(c) it extinguishes the member's entitlement to benefits under the pension scheme, and

(d) it is paid when the member has reached the normal minimum pension age but has not reached the age of 80.

(2) The nominated date is any day after the member has reached the normal minimum pension age but has not reached the age of 80 nominated by the member or by the scheme administrator (provided the scheme administrator has given the member at least one month's written notice of the intention to nominate a date and the member has not objected in writing before that date).

(3) The commutation limit is 1 per cent. of the standard lifetime allowance on the nominated date.

(4) The value of the member's pension rights on the nominated date is the aggregate of—

(a) the value of the member's relevant crystallised pension rights on that date (calculated in accordance with paragraph 8), and

(b) the value of the member's uncrystallised rights on that date (calculated in accordance with paragraph 9).'.