SCHEDULES

SCHEDULE 36U.K.Pension schemes etc: transitional provisions and savings

Modifications etc. (not altering text)

Part 2U.K.Pre-commencement rights: [F1enhancement of allowances etc]

Textual Amendments

F1Words in Sch. 36 Pt. 2 heading substituted (6.4.2024 for the tax year 2024-25 and subsequent tax years) by Finance Act 2024 (c. 3), Sch. 9 paras. 66, 124 (with Sch. 9 paras. 125-132A) (as amended by S.I. 2024/356, regs. 1, 4)

Modifications etc. (not altering text)

C3Sch. 36 Pt. 2 applied (with modifications) (1.5.2010) by The Financial Assistance Scheme (Tax) Regulations 2010 (S.I. 2010/1187), regs. 1(1), 5-11

“Enhanced protection” U.K.

14(1)For the purposes of paragraph 13(a) a relevant contribution is paid under the arrangement if—U.K.

(a)a relievable pension contribution is paid by or on behalf of the individual under the arrangement,

(b)a contribution is paid in respect of the individual under the arrangement by an employer of the individual, or

(c)a contribution paid [F2otherwise than by or on behalf of the individual or by an employer of the individual] in respect of the individual subsequently becomes held for the purposes of the provision under the arrangement of benefits to or in respect of the individual.

F3(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F4(3)A contribution is not a relevant contribution for the purposes of paragraph 13(a) if—

(a)it may only be applied for or towards the payment of premiums under a policy of insurance on the life of the individual,

(b)the policy is issued, or issued in respect of insurances made, before 6th April 2006,

(c)there is no right to surrender any rights under the policy,

(d)the terms of the policy are not varied significantly during the period beginning with 6th April 2006 and ending with the individual's actual death so as to increase the benefits payable under the policy or extend the period during which benefits are so payable, and

(e)no benefits are paid, or other payments made, under (or on the surrender of rights under) the policy except by reason of the individual's death;

and any exercise of rights conferred by the policy is to be regarded for this purpose as a variation.

[F5(3A)A variation of the terms of a policy made in order to comply with the [F6Part 5 of the Equality Act 2010, so far as relating to age, or the] Employment Equality (Age) Regulations (Northern Ireland) 2006 (or any regulations amending or replacing [F7those Regulations]) is to be ignored for the purposes of sub-paragraph (3).

(3B)Where a policy of insurance on the life of the individual issued, or issued in respect of insurances made, before 6th April 2006 is surrendered and a new one is taken out—

(a)as part of a retirement-benefit activities compliance exercise, or

(b)as part of an age-equality compliance exercise.

the new policy is to be treated for the purposes of sub-paragraph (3) as if it were the same as the old.

(3C)For the purposes of sub-paragraph (3B)(a) a policy is surrendered, and a new policy of life insurance is taken out, as part of a retirement-benefit activities compliance exercise if—

(a)the surrender of the old policy and the taking out of the new policy constitute or form part of a transaction the purpose of which is to secure that the activities of the pension scheme under which the arrangement is made are limited to retirement-benefit activities within the meaning of section 255 of the Pensions Act 2004 or Article 232 of the Pensions (Northern Ireland) Order 2005, and

(b)the rights under the old policy and the new policy are not significantly different.

(3D)For the purposes of sub-paragraph (3B)(b) a policy is surrendered, and a new policy of life insurance is taken out, as part of an age-equality compliance exercise if—

(a)the old policy is surrendered, and the new policy is taken out, in order to comply with [F8Part 5 of the Equality Act 2010, so far as relating to age, or the] or Employment Equality (Age) Regulations (Northern Ireland) 2006 (or any regulations amending or replacing [F9those Regulations]), and

(b)any significant difference between the rights under the old policy and the rights under the new policy is attributable to the need to comply with those Regulations (or any regulations amending or replacing them).]

(4)A contribution is not a relevant contribution for the purposes of paragraph 13(a) if it is paid—

(a)by a sponsoring employer,

(b)under a relevant hybrid arrangement, and

(c)solely in respect of the provision in respect of the individual of lump sum death benefits which are defined benefits or cash balance benefits.

(5)A “relevant hybrid arrangement” is a hybrid arrangement under an occupational pension scheme—

(a)which subsequently becomes a money purchase arrangement that is not a cash balance arrangement, and

(b)under which lump sum death benefits would have been payable in respect of the individual if the individual had died on 5th April 2006.]

Textual Amendments

F2Words in Sch. 36 para. 14(1)(c) substituted (6.4.2006) by Finance Act 2005 (c. 7), Sch. 10 paras. 53(9), 64(1)

F3Sch. 36 para. 14(2) omitted (retrospective to 6.4.2013) by virtue of Finance Act 2013 (c. 29), s. 52(9)(10)

F4Sch. 36 para. 14(3)-(5) inserted (retrospective to 6.4.2006) by Finance Act 2006 (c. 25), s. 161(2), Sch. 23 para. 39

F5Sch. 36 para. 14(3A)-(3D) inserted (retrospective to 6.4.2006) by Finance Act 2007 (c. 11), Sch. 20 paras. 18, 24(3)

F6Words in Sch. 36 para. 14(3A) substituted by Equality Act 2010 (c. 15), Sch. 26 Pt. 1 para. 59(a) (as inserted (E.W.S.) (1.10.2010) by S.I. 2010/2279, art. 1(2), Sch. 1 para. 5 (see S.I. 2010/2317, art. 2))

F7Words in Sch. 36 para. 14(3A) substituted by Equality Act 2010 (c. 15), Sch. 26 Pt. 1 para. 59(b) (as inserted (E.W.S.) (1.10.2010) by S.I. 2010/2279, art. 1(2), Sch. 1 para. 5 (see S.I. 2010/2317, art. 2))

F8Words in Sch. 36 para. 14(3D)(a) substituted by Equality Act 2010 (c. 15), Sch. 26 Pt. 1 para. 59(a) (as inserted (E.W.S.) (1.10.2010) by S.I. 2010/2279, art. 1(2), Sch. 1 para. 5 (see S.I. 2010/2317, art. 2))

F9Words in Sch. 36 para. 14(3D)(a) substituted by Equality Act 2010 (c. 15), Sch. 26 Pt. 1 para. 59(b) (as inserted (E.W.S.) (1.10.2010) by S.I. 2010/2279, art. 1(2), Sch. 1 para. 5 (see S.I. 2010/2317, art. 2))

Modifications etc. (not altering text)

C4Sch. 36 para. 14 applied (19.7.2011) by Finance Act 2011 (c. 11), Sch. 18 para. 14(11)

C5Sch. 36 para. 14 applied (with application in accordance with Sch. 22 para. 1 of the amending Act) by Finance Act 2013 (c. 29), Sch. 22 para. 1(10)