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Finance Act 2004

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Changes over time for: Pension protection lump sum death benefit

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Version Superseded: 19/07/2011

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Status:

Point in time view as at 21/07/2009.

Changes to legislation:

There are currently no known outstanding effects for the Finance Act 2004, Pension protection lump sum death benefit. Help about Changes to Legislation

Pension protection lump sum death benefitU.K.

14(1)For the purposes of this Part a lump sum death benefit is a pension protection lump sum death benefit if—U.K.

(a)the member had not reached the age of 75 at the date of the member’s death,

(b)it is paid in respect of a defined benefits arrangement,

(c)it is paid in respect of a scheme pension to which the member was entitled at the date of the member’s death, and

(d)the member has specified that it is to be treated as a pension protection lump sum death benefit (instead of a defined benefits lump sum death benefit).

(2)But if the amount of a lump sum falling within sub-paragraph (1) exceeds the pension protection limit, the excess is not a pension protection lump sum death benefit.

(3)The pension protection limit is—

where—

AC is the amount crystallised by reason of the member becoming entitled to the pension (see section 216),

AP is the amount of the pension paid in respect of the period between the member becoming entitled to the pension and the member’s death, and

TPLS is the total amount of pension protection lump sum death benefit previously paid in respect of the pension under this paragraph.

Modifications etc. (not altering text)

C5Sch. 29 para. 14(3) modified (6.4.2006) by The Taxation of Pension Schemes (Transitional Provisions) Order 2006 (S.I. 2006/572), arts. 1(1), 33(1)(2)(4); (as amended (18.11.2024 for the tax year 2024-25 and subsequent tax years) by S.I. 2024/1012, regs. 1(2)(3), 25(21)(b))

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