Finance Act 2004

[F1 2C (1) This paragraph defines “the applicable amount” in relation to a relevant pension in a case in which the relevant pension is [F2 a scheme pension under]— U.K.

(a) F3 ... a defined benefits arrangement, or

(b) a collective money purchase arrangement.

(2) F4 The applicable amount is (subject to [F5 sub-paragraphs (3) and (4)])—

where—

• A is the amount of the lump sum;

• B is the relevant [F6 valuation] factor (see section 276);

• C is the amount of the pension which will be payable to the member in the period of 12 months beginning with the day on which the member becomes entitled to the pension (assuming that it remains payable throughout that period at the rate at which it is payable on that day);

• F7 ...

(3) In determining C for the purposes of [F8 sub-paragraph] (2) in a case in which the pension is under a public service pension scheme, any abatement of the pension is to be left out of account.

[F9 (4) For the purposes of sub-paragraph (2), any part of what would otherwise be A or C which represents rights attributable to a disqualifying pension credit is to be disregarded.]]

Textual Amendments

F1 Sch. 29 paras. 2A-2D substituted for Sch. 29 para. 3 (for the tax year 2024-25 and subsequent tax years) by Finance Act 2024 (c. 3), Sch. 9 paras. 26(5), 124 (with Sch. 9 paras. 125-132A) (as amended by S.I. 2024/356, regs. 1, 4; and (18.11.2024 for the tax year 2024-25 and subsequent tax years) by S.I. 2024/1012, regs. 1(2)(3), 17)

F2 Words in Sch. 29 para. 2C(1) inserted (18.11.2024 for the tax year 2024-25 and subsequent tax years) by The Pensions (Abolition of Lifetime Allowance Charge etc) (No. 3) Regulations 2024 (S.I. 2024/1167), regs. 1(2)(3), 2(2)(a)(i) (with reg. 6)

F3 Words in Sch. 29 para. 2C(1)(a) omitted (18.11.2024 for the tax year 2024-25 and subsequent tax years) by virtue of The Pensions (Abolition of Lifetime Allowance Charge etc) (No. 3) Regulations 2024 (S.I. 2024/1167), regs. 1(2)(3), 2(2)(a)(ii) (with reg. 6)

F4 Sch. 29 para. 2C(2): word “- D” in formula omitted (18.11.2024 for the tax year 2024-25 and subsequent tax years) by virtue of The Pensions (Abolition of Lifetime Allowance Charge etc) (No. 3) Regulations 2024 (S.I. 2024/1167), regs. 1(2)(3), 2(2)(b)(ii) (with reg. 6)

F5 Words in Sch. 29 para. 2C(2) substituted (18.11.2024 for the tax year 2024-25 and subsequent tax years) by The Pensions (Abolition of Lifetime Allowance Charge etc) (No. 3) Regulations 2024 (S.I. 2024/1167), regs. 1(2)(3), 2(2)(b)(i) (with reg. 6)

F6 Word in Sch. 29 para. 2C(2) substituted (18.11.2024 for the tax year 2024-25 and subsequent tax years) by The Pensions (Abolition of Lifetime Allowance Charge etc) (No. 3) Regulations 2024 (S.I. 2024/1167), regs. 1(2)(3), 2(2)(b)(iii) (with reg. 6)

F7 Words in Sch. 29 para. 2C(2) omitted (18.11.2024 for the tax year 2024-25 and subsequent tax years) by virtue of The Pensions (Abolition of Lifetime Allowance Charge etc) (No. 3) Regulations 2024 (S.I. 2024/1167), regs. 1(2)(3), 2(2)(b)(iv) (with reg. 6)

F8 Word in Sch. 29 para. 2C(3) substituted (18.11.2024 for the tax year 2024-25 and subsequent tax years) by The Pensions (Abolition of Lifetime Allowance Charge etc) (No. 3) Regulations 2024 (S.I. 2024/1167), regs. 1(2)(3), 2(2)(c) (with reg. 6)

F9 Sch. 29 para. 2C(4) inserted (18.11.2024 for the tax year 2024-25 and subsequent tax years) by The Pensions (Abolition of Lifetime Allowance Charge etc) (No. 3) Regulations 2024 (S.I. 2024/1167), regs. 1(2)(3), 2(2)(d) (with reg. 6)