http://www.legislation.gov.uk/uksi/1996/1847/regulation/4/2008-04-01The Occupational Pension Schemes (Transfer Values) Regulations 1996texttext/xmlenStatute Law DatabasePENSIONS2024-05-16Expert Participation2008-04-01 These Regulations replace the Occupational Pension Schemes (Transfer Values) Regulations 1985 which are now revoked. The Regulations supplement the changes introduced by the Pensions Act 1995 to Chapter IV of Part IV of the Pension Schemes Act 1993. They also consolidate and amend the 1985 Regulations. Provisions carried forward from the 1985 Regulations are amended to take into account new provisions introduced by the 1995 Act and changes made by the 1995 Act to parts of the 1993 Act other than Chapter IV of Part IV. Provisions carried forward from the 1985 Regulations which have been amended substantively for other reasons are contained in regulation 8(3) (requirement to obtain actuary’s report before directing that cash equivalents not take account of discretionary benefits), regulation 10 (requirement to increase cash equivalent if paid late) and regulation 11 (disclosure requirements and penalties).The regulations made by virtue of sections 152 to 154 of and Schedule 6 to the Pensions Act 1995 are made within six months of those provisions coming into force and as a consequence there is no requirement to consult. As regards those regulations which are neither made only for the purpose of consolidation nor under the 1995 Act, the Occupational Pensions Board has agreed that proposals to make such regulations need not be referred to them.Part II of the Regulations provides restrictions on the right to take a cash equivalent if the member’s pensionable service terminated before 1st January 1986 or if the member terminates his or her pensionable service while still in employment to which the scheme applies.Part III of the Regulations concerns the new requirements relating to guaranteed statements of entitlement for members of salary related occupational pension schemes. Part III also deals with the way in which cash equivalents are to be calculated. Regulation 6 sets out the time limits within which the guarantee date in respect of a guaranteed statement of entitlement must fall and within which the statement must be provided to the member. Regulations 7 to 10 provide how cash equivalents are to be calculated and the circumstances in which they can be increased or reduced. Regulation 11 consolidates (with minor amendments) provisions relating to estimates of cash equivalents which were previously contained in the Occupational Pension Schemes (Disclosure of Information) Regulations 1986. Regulation 11 also contains further disclosure requirements. Penalties are imposed for breaches of any of the requirements of regulation 11.Part IV of the Regulations sets out the requirements which a pension scheme must satisfy if a cash equivalent is to be used for acquiring transfer credits in it or rights under it, the requirements which an annuity must satisfy if a cash equivalent is to be used for purchasing it and the requirements which an overseas arrangement or a self-employed pension arrangement must satisfy if a cash equivalent is to be used for subscribing to it.Part V of the Regulations provides for the Regulatory Authority to extend the statutory time limits for payment of cash equivalents on the application of the trustees or managers of the scheme in question.Part VI of the Regulations modifies the Pension Schemes Act 1993 in certain circumstances. Regulation 14 modifies section 94(1)(aa) to extend the period within which a member may apply to take his or her guaranteed cash equivalent where that member has been informed that that guaranteed cash equivalent is to be increased or reduced or where the member has disputed the amount of the cash equivalent. Regulation 19 modifies certain provisions of Chapter IV of Part IV in relation to a scheme which provides or may provide both salary related and money purchase benefits. Regulations 15 to 18 carry forward provisions previously contained in the Occupational Pension Schemes (Transfer Values) Regulations 1985.Part VII of the Regulations sets out the penalties that apply for breaches of obligations imposed by section 93A (obligation to provide guaranteed statements of entitlement within certain time limits) and section 99(2) (obligation to pay cash equivalent within certain time limits) of the 1993 Act.Part VIII of the Regulations contains revocations and transitional provisions.An assessment of the compliance cost for employers of the measures arising from the Pensions Act 1995, including these Regulations, has been placed in the libraries of both Houses of Parliament. Copies can be obtained by post from the Department of Social Security, Private Pensions Directorate, 11th floor, The Adelphi, 1-11 John Adam Street, London WC2N 6HT. PART II RESTRICTIONS ON RIGHT TO CASH EQUIVALENT Right to further cash equivalent on termination of employment to which the scheme applies41This regulation applies to a case where regulation 3 (or regulation 2A of the Occupational Pension Schemes (Transfer Values) Regulations 1985 ) has operated to restrict a member’s cash equivalent and subsequently the member’s employment terminates on a date which is at least one year earlier than the date on which the member would attain the age which is the normal pension age for the scheme or, where the normal pension age is earlier than 60, the age of 60.2Where this regulation applies, a right to any cash equivalent or any part of a guaranteed cash equivalent to which the member has not acquired a right but would, but for the operation of regulation 3 (or regulation 2A of the Occupational Pension Schemes (Transfer Values) Regulations 1985), have acquired a right by the date when the member’s employment terminates shall accrue to the member on that date.3Where a right to any part of a guaranteed cash equivalent accrues to a member under paragraph (2), the cash equivalent of the benefits to which that part relates shall be recalculated as at—athe date on which the member’s employment terminates; or, if later,bthe date on which the member applies to take that partand that part shall be increased or reduced by the amount by which it falls short of or exceeds the value of the cash equivalent of those benefits as so recalculated.4In relation to any case to which this regulation applies there shall be substituted for the definitions of “relevant date" in section 94(2) of the 1993 Act (right to cash equivalent) and of “the last option date" in section 95(8) of that Act (ways of taking right to cash equivalent) the following definitions—“relevant date" means the date when the member’s employment terminates or the date of the relevant application, whichever is the later, and“the last option date" means the date which falls—aone year before the date on which the member attains normal pension age; orbsix months after the date when his employment terminates,whichever is the later.5In this regulation “employment" means employment to which the scheme applies.S.I. 1985/1931. The relevant amending instruments are S.I. 1987/1107, S.I. 1988/523, S.I. 1990/1142 and S.I. 1994/1062.
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<dc:title>The Occupational Pension Schemes (Transfer Values) Regulations 1996</dc:title>
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<dc:description>These Regulations replace the Occupational Pension Schemes (Transfer Values) Regulations 1985 which are now revoked. The Regulations supplement the changes introduced by the Pensions Act 1995 to Chapter IV of Part IV of the Pension Schemes Act 1993. They also consolidate and amend the 1985 Regulations. Provisions carried forward from the 1985 Regulations are amended to take into account new provisions introduced by the 1995 Act and changes made by the 1995 Act to parts of the 1993 Act other than Chapter IV of Part IV. Provisions carried forward from the 1985 Regulations which have been amended substantively for other reasons are contained in regulation 8(3) (requirement to obtain actuary’s report before directing that cash equivalents not take account of discretionary benefits), regulation 10 (requirement to increase cash equivalent if paid late) and regulation 11 (disclosure requirements and penalties).The regulations made by virtue of sections 152 to 154 of and Schedule 6 to the Pensions Act 1995 are made within six months of those provisions coming into force and as a consequence there is no requirement to consult. As regards those regulations which are neither made only for the purpose of consolidation nor under the 1995 Act, the Occupational Pensions Board has agreed that proposals to make such regulations need not be referred to them.Part II of the Regulations provides restrictions on the right to take a cash equivalent if the member’s pensionable service terminated before 1st January 1986 or if the member terminates his or her pensionable service while still in employment to which the scheme applies.Part III of the Regulations concerns the new requirements relating to guaranteed statements of entitlement for members of salary related occupational pension schemes. Part III also deals with the way in which cash equivalents are to be calculated. Regulation 6 sets out the time limits within which the guarantee date in respect of a guaranteed statement of entitlement must fall and within which the statement must be provided to the member. Regulations 7 to 10 provide how cash equivalents are to be calculated and the circumstances in which they can be increased or reduced. Regulation 11 consolidates (with minor amendments) provisions relating to estimates of cash equivalents which were previously contained in the Occupational Pension Schemes (Disclosure of Information) Regulations 1986. Regulation 11 also contains further disclosure requirements. Penalties are imposed for breaches of any of the requirements of regulation 11.Part IV of the Regulations sets out the requirements which a pension scheme must satisfy if a cash equivalent is to be used for acquiring transfer credits in it or rights under it, the requirements which an annuity must satisfy if a cash equivalent is to be used for purchasing it and the requirements which an overseas arrangement or a self-employed pension arrangement must satisfy if a cash equivalent is to be used for subscribing to it.Part V of the Regulations provides for the Regulatory Authority to extend the statutory time limits for payment of cash equivalents on the application of the trustees or managers of the scheme in question.Part VI of the Regulations modifies the Pension Schemes Act 1993 in certain circumstances. Regulation 14 modifies section 94(1)(aa) to extend the period within which a member may apply to take his or her guaranteed cash equivalent where that member has been informed that that guaranteed cash equivalent is to be increased or reduced or where the member has disputed the amount of the cash equivalent. Regulation 19 modifies certain provisions of Chapter IV of Part IV in relation to a scheme which provides or may provide both salary related and money purchase benefits. Regulations 15 to 18 carry forward provisions previously contained in the Occupational Pension Schemes (Transfer Values) Regulations 1985.Part VII of the Regulations sets out the penalties that apply for breaches of obligations imposed by section 93A (obligation to provide guaranteed statements of entitlement within certain time limits) and section 99(2) (obligation to pay cash equivalent within certain time limits) of the 1993 Act.Part VIII of the Regulations contains revocations and transitional provisions.An assessment of the compliance cost for employers of the measures arising from the Pensions Act 1995, including these Regulations, has been placed in the libraries of both Houses of Parliament. Copies can be obtained by post from the Department of Social Security, Private Pensions Directorate, 11th floor, The Adelphi, 1-11 John Adam Street, London WC2N 6HT.</dc:description>
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<Number>PART II</Number>
<Title> RESTRICTIONS ON RIGHT TO CASH EQUIVALENT</Title>
<P1group RestrictEndDate="2015-04-01" RestrictStartDate="2008-04-01">
<Title> Right to further cash equivalent on termination of employment to which the scheme applies</Title>
<P1 DocumentURI="http://www.legislation.gov.uk/uksi/1996/1847/regulation/4/2008-04-01" IdURI="http://www.legislation.gov.uk/id/uksi/1996/1847/regulation/4" id="regulation-4">
<Pnumber>4</Pnumber>
<P1para>
<P2 DocumentURI="http://www.legislation.gov.uk/uksi/1996/1847/regulation/4/1/2008-04-01" IdURI="http://www.legislation.gov.uk/id/uksi/1996/1847/regulation/4/1" RestrictEndDate="2015-04-01" id="regulation-4-1">
<Pnumber>1</Pnumber>
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<Text>
This regulation applies to a case where regulation 3 (or regulation 2A of the Occupational Pension Schemes (Transfer Values) Regulations 1985
<CommentaryRef Ref="c1867207"/>
) has operated to restrict a member’s cash equivalent and subsequently the member’s employment terminates on a date which is at least one year earlier than the date on which the member would attain the age which is the normal pension age for the scheme or, where the normal pension age is earlier than 60, the age of 60.
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<P2 DocumentURI="http://www.legislation.gov.uk/uksi/1996/1847/regulation/4/2/2008-04-01" IdURI="http://www.legislation.gov.uk/id/uksi/1996/1847/regulation/4/2" RestrictEndDate="2015-04-01" id="regulation-4-2">
<Pnumber>2</Pnumber>
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<Text>Where this regulation applies, a right to any cash equivalent or any part of a guaranteed cash equivalent to which the member has not acquired a right but would, but for the operation of regulation 3 (or regulation 2A of the Occupational Pension Schemes (Transfer Values) Regulations 1985), have acquired a right by the date when the member’s employment terminates shall accrue to the member on that date.</Text>
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<Pnumber>3</Pnumber>
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<Text>Where a right to any part of a guaranteed cash equivalent accrues to a member under paragraph (2), the cash equivalent of the benefits to which that part relates shall be recalculated as at—</Text>
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<Pnumber>a</Pnumber>
<P3para>
<Text>the date on which the member’s employment terminates; or, if later,</Text>
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<Pnumber>b</Pnumber>
<P3para>
<Text>the date on which the member applies to take that part</Text>
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<Text>and that part shall be increased or reduced by the amount by which it falls short of or exceeds the value of the cash equivalent of those benefits as so recalculated.</Text>
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<Pnumber>4</Pnumber>
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<Text>In relation to any case to which this regulation applies there shall be substituted for the definitions of “relevant date" in section 94(2) of the 1993 Act (right to cash equivalent) and of “the last option date" in section 95(8) of that Act (ways of taking right to cash equivalent) the following definitions—</Text>
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<Text>“relevant date" means the date when the member’s employment terminates or the date of the relevant application, whichever is the later</Text>
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<P2para>
<Text>“the last option date" means the date which falls—</Text>
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<Pnumber>a</Pnumber>
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<Text>one year before the date on which the member attains normal pension age; or</Text>
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<AppendText>.</AppendText>
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<Pnumber>5</Pnumber>
<P2para>
<Text>In this regulation “employment" means employment to which the scheme applies.</Text>
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<Para>
<Text>
<Citation URI="http://www.legislation.gov.uk/id/uksi/1985/1931" id="c00025" Class="UnitedKingdomStatutoryInstrument" Year="1985" Number="1931">S.I. 1985/1931</Citation>
. The relevant amending instruments are
<Citation URI="http://www.legislation.gov.uk/id/uksi/1987/1107" id="c00026" Class="UnitedKingdomStatutoryInstrument" Year="1987" Number="1107">S.I. 1987/1107</Citation>
,
<CitationSubRef id="c00027" CitationRef="c00026" URI="http://www.legislation.gov.uk/id/uksi/1987/1107/section/I" Operative="true" SectionRef="section-I">S.I</CitationSubRef>
. 1988/523,
<Citation URI="http://www.legislation.gov.uk/id/uksi/1990/1142" id="c00028" Class="UnitedKingdomStatutoryInstrument" Year="1990" Number="1142">S.I. 1990/1142</Citation>
and
<Citation URI="http://www.legislation.gov.uk/id/uksi/1994/1062" id="c00029" Class="UnitedKingdomStatutoryInstrument" Year="1994" Number="1062">S.I. 1994/1062</Citation>
.
</Text>
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