Finance Act 2004

Benefit crystallisation events 1 and 5: hybrid arrangements

5 (1) This paragraph applies where—

(a) immediately before the individual reaches the age of 75, there is under any of the relevant pension schemes a hybrid arrangement relating to the individual, and

(b) the benefits that may be provided to or in respect of the individual under the arrangement may, depending on the circumstances, be money purchase benefits or defined benefits.

(2) Benefit crystallisation event 1 applies as if, at that time, the circumstances are such that the benefits to be provided are money purchase benefits (with the effect that the sums or assets held for the purposes of the arrangement are to be treated as having been designated as available for the provision of unsecured pension to the individual).

(3) Benefit crystallisation event 5 applies as if, at that time, the circumstances are such that the benefits to be provided are defined benefits.

(4) The amount crystallised is the greater of the amounts crystallised by the two benefit crystallisation events.