(1)These are the rules relating to the payment of pensions by a registered pension scheme to a member of the pension scheme (“the pension rules”).
Pension rule 1
No payment of pension may be made before the day on which the member reaches normal minimum pension age, unless the ill-health condition was met immediately before the member became entitled to a pension under the pension scheme.
Pension rule 2
If the member dies before the end of the period of ten years beginning with the day on which the member became entitled to a scheme pension, an annuity or alternatively secured pension, payment of the scheme pension, annuity or alternatively secured pension may continue to be made (to any person) until the end of that period.
But no other payment of the member’s pension may be made after the member’s death.
Pension rule 3
No payment of pension other than a scheme pension may be made in respect of a defined benefits arrangement.
Pension rule 4
If the member has not reached the age of 75, no payment of pension other than—
a scheme pension,
a lifetime annuity, or
unsecured pension,
may be made in respect of a money purchase arrangement; but a scheme pension may only be paid if the member had an opportunity to select a lifetime annuity instead.
Pension rule 5
The total amount of unsecured pension paid in each unsecured pension year in respect of a money purchase arrangement must not exceed 120% of the basis amount for the unsecured pension year.
Pension rule 6
If the member has reached the age of 75, no payment of pension other than—
a scheme pension,
a lifetime annuity, or
alternatively secured pension,
may be made in respect of a money purchase arrangement; but a scheme pension may only be paid if the member had an opportunity to select a lifetime annuity instead.
Pension rule 7
The total amount of alternatively secured pension paid in each alternatively secured pension year in respect of a money purchase arrangement must not exceed 70% of the basis amount for the alternatively secured pension year.
(2)In this Part “pension”, in relation to a registered pension scheme, includes—
(a)an annuity, and
(b)income withdrawal.
(3)For the purposes of this Part, a person becomes entitled to a pension under a registered pension scheme—
(a)in the case of income withdrawal under the pension scheme, whenever sums or assets held for the purposes of an arrangement under the pension scheme are designated as available for the payment of unsecured pension, and
(b)in any other case, when the person first acquires an actual (rather than a prospective) right to receive the pension.
(4)Part 1 of Schedule 28 gives the meaning of expressions used in the pension rules.