PART XIV PENSION SCHEMES, SOCIAL SECURITY BENEFITS, LIFE ANNUITIES ETC.

CHAPTER IV PERSONAL PENSION SCHEMES

Restrictions on approval

636 Annuity after death of member.
(1) The annuity must be payable by an authorised insurance company which may be chosen by the member or by the annuitant.
Source-1987 (No.2) s.24
(2) The annuity must be payable to the surviving spouse or civil partner of the member, or to a person who was at the member’s death a dependant of his.
Words in s. 636(2) inserted (5.12.2005) by The Tax and Civil Partnership Regulations 2005 (S.I. 2005/3229), regs. 1(1), 89(2)
(3) The aggregate annual amount (or, if that amount varies, the aggregate of the initial annual amounts) of all annuities to which this section applies and which are payable under the same personal pension arrangements shall not exceed—
(a) where before his death the member was in receipt of an annuity under the arrangements, the annual amount (or, if it varied, the highest annual amount) of that annuity; or
(b) where paragraph (a) does not apply, the highest annual amount of the annuity that would have been payable under the arrangements to the member (ignoring any entitlement of his to commute part of it for a lump sum) if it had been purchased on the day before his death.
Words in s. 636(3) substituted (1.5.1995) by Finance Act 1995 (c. 4), Sch. 11 para. 6
(3A) The references in subsection (3) above—
(a) to the annual amount or highest annual amount of an annuity of which the member was in receipt before his death, and
(b) to the highest annual amount of an annuity that would have been payable if it had been purchased on the day before the member’s death,
shall each be construed in a case where payments of that annuity were or would have been affected by the making of any pension sharing order or provision as if the only payments of that annuity to be taken into account were those that have been or would have been so affected.
S. 636(3A) inserted (with application in accordance with Sch. 10 para. 18(8)(9) of the amending Act) by Finance Act 1999 (c. 16), Sch. 10 para. 13(1); S.I. 2000/1093, art. 2
(4) Subject to subsections (5) to (9) below, the annuity must be payable for the life of the annuitant.
(5) Where the annuity is payable to the surviving spouse or civil partner of the member and at the time of the member’s death the surviving spouse or civil partner is under the age of 60, the annuity may be deferred to a time not later than—
(a) the time when the surviving spouse or civil partner attains that age; or
(b) where the member’s annuity is payable to the surviving spouse or civil partner for a term certain as mentioned in section 634(5) and the surviving spouse or civil partner attains the age of 60 before the time when the member’s annuity terminates, that time.
Words in s. 636(5) inserted (5.12.2005) by The Tax and Civil Partnership Regulations 2005 (S.I. 2005/3229), regs. 1(1), 89(3)
(6) The annuity may cease to be payable on the annuitant marrying or forming a civil partnership.
Words in s. 636(6) substituted (5.12.2005) by The Tax and Civil Partnership Regulations 2005 (S.I. 2005/3229), regs. 1(1), 89(4)
(7) Where the annuity is payable to the surviving spouse or civil partner of the member, it may cease before the death of the surviving spouse or civil partner if—
(a) the member was survived by one or more dependants under the age of 18 and at the time of the member’s death the surviving spouse or civil partner was under the age of 45; and
(b) at some time before the surviving spouse or civil partner attains that age no such dependant remains under the age of 18.
Words in s. 636(7) inserted (5.12.2005) by The Tax and Civil Partnership Regulations 2005 (S.I. 2005/3229), regs. 1(1), 89(5)
(8) Where the annuity is payable to a person who is under the age of 18 when it is first payable, it must cease to be payable either—
(a) on his attaining that age; or
(b) on the later of his attaining that age and ceasing to be in full-time education,
unless he was a dependant of the member otherwise than by reason only that he was under the age of 18.
(9) The annuity may continue for a term certain not exceeding ten years, notwithstanding the original annuitant’s death within that term; and for this purpose an annuity shall be regarded as payable for a term certain notwithstanding that it may terminate, after the death of the original annuitant and before the expiry of that term, on the happening of any of the following—
(a) . . . the annuitant to whom it is payable marrying or forming a civil partnership;
Words in s. 636(9)(a) omitted (5.12.2005) by virtue of The Tax and Civil Partnership Regulations 2005 (S.I. 2005/3229), regs. 1(1), 89(6)
Words in s. 636(9)(a) inserted (5.12.2005) by The Tax and Civil Partnership Regulations 2005 (S.I. 2005/3229), regs. 1(1), 89(6)
(b) his attaining the age of 18;
(c) the later of his attaining that age and ceasing to be in full-time education.
(10) The annuity must not be capable of assignment or surrender, except that—
(a) an annuity may be assigned or surrendered for the purpose of giving effect to a pension sharing order or provision; and
(b) an annuity for a term certain may be assigned by will or by the annuitant’s personal representatives in the distribution of his estate so as to give effect to a testamentary disposition, or to the rights of those entitled on an intestacy, or to an appropriation of it to a legacy or to a share or interest in the estate.
Words in s. 636(10) substituted (with application in accordance with Sch. 10 para. 18(8)(9) of the amending Act) by Finance Act 1999 (c. 16), Sch. 10 para. 13(2); S.I. 2000/1093, art. 2
Pt. 14 Ch. 5 excluded (1.5.1995) by Finance Act 1995 (c. 4), s. 60(5)