PART 7Benefits for pension credit members

Commutation of part of pension117

1

A pension credit member who becomes entitled to payment of a pension credit member’s pension under this scheme may opt to exchange part of the pension for a lump sum.

2

The option may only be exercised by notice —

a

to the scheme manager not earlier than 4 months before the later of—

i

the date on which the pension sharing order comes into effect; or

ii

the date on which the person attains deferred pension age;

b

in such form as the scheme manager requires; and

c

before the first payment of the pension is made.

3

If a pension credit member exercises the option under this regulation, for every £1 by which the amount of the member’s annual rate of pension is reduced, the member is to be paid a lump sum of £12.

4

The commuted portion must not exceed one quarter of the amount of the pension credit member’s pension.

5

A pension credit member may not exchange pension for a lump sum under this regulation to the extent that it would result in a scheme chargeable payment for the purposes of Part 4 (pension scheme etc) of the 2004 Act (see section 241 of that Act).

6

This regulation does not apply if the pension debit member from whose rights the pension is derived received a lump sum under Part 5 (retirement benefits) before the date on which the pension sharing order takes effect.