SCHEDULES

SCHEDULE 28Inheritance of tax-relieved pension savings

Amendments of Part 4 of FA 2004

4

1

Section 172B (increase in rights of connected person on death) is amended as follows.

2

In subsection (2), at the end of paragraph (a) (but before the “or”) insert—

aa

rights to payments under a scheme pension or dependants' scheme pension provided by the scheme administrator or as a result of the application of sums or assets held for the purposes of the pension scheme or under a lifetime annuity or dependants' annuity purchased by the application of sums or assets held for the purposes of the pension scheme,

3

In subsections (3)(a) and (7)(b), for “is actually or prospectively entitled” substitute “ has an actual or prospective entitlement ”.

4

In subsection (7)—

a

omit paragraph (a) (including the “and” at the end), and

b

in paragraph (b), for “them” substitute “ at least 20 members of the pension scheme ”.

5

After subsection (7) insert—

7A

This section does not apply if—

a

the increase mentioned in subsection (1)(a) is an increase in the rate of a dependants' annuity or dependants' scheme pension or in rights representing a dependants' unsecured pension fund or dependants' alternatively secured pension fund, and

b

the increase is attributable to rights of the dead member to payments under a dependants' annuity or dependants' scheme pension or rights representing a dependants' unsecured pension fund.

7B

References in this section to a benefit to which the member or a person has an entitlement under the pension scheme includes rights to payments under—

a

a scheme pension or dependants' scheme pension provided by the scheme administrator or as a result of the application of sums or assets held for the purposes of the pension scheme, or

b

a lifetime annuity or dependants' annuity purchased by the application of sums or assets held for the purposes of the pension scheme.