PART III E+W+S DEATH OF PERSON ENTITLED TO A PENSION CREDIT BEFORE LIABILITY IN RESPECT OF THE PENSION CREDIT IS DISCHARGED

Discharge of liability in respect of a pension credit following the death of the person entitled to the pension credit E+W+S

[F1 6.—(1) The person responsible for the pension arrangement shall following the death of the person entitled to the pension credit discharge his liability in respect of a pension credit in accordance with this regulation.

(2)  Where the rules or provisions of a pension arrangement so provide and provided that any requirements of the Inland Revenue under [F2 Part 4 of the Finance Act 2004 (pension schemes etc )] are satisfied, the person responsible for the pension arrangement shall discharge his liability in respect of a pension credit by undertaking to—

(a) make—

(i) a payment of a lump sum; or

(ii) payments of a pension; or

(iii) payments of both a lump sum and a pension,

to one or more persons; or

(b) enter into an annuity contract or take out a policy of insurance with an insurance company for the benefit of one or more persons; or

(c) make a payment or, as the case may be, payments under sub-paragraph (a) and enter into an annuity contract or take out an insurance policy under sub-paragraph (b).

(3) Where paragraph (2)(b) or (c) applies, the annuity contract entered into or insurance policy taken out must satisfy the requirements of paragraph 6(2) of Schedule 5 to the 1999 Act (qualifying arrangements) and regulation 11 of these Regulations.

(4) Where the provisions of paragraph (2) do not apply, liability in respect of a pension credit shall be discharged by retaining the value of the pension credit in the pension arrangement from which that pension credit was derived.

(5) Where—

(a) liability in respect of a pension credit has been discharged in accordance with paragraph (2); and

(b) the value of the payment or payments made, the annuity contract entered into or the insurance policy taken out, as the case may be, is less than the value of the pension credit,

the value of an amount equal to the difference between the value of the pension credit and the value of that payment or those payments, that contract or policy, as the case may be, shall be retained in the pension arrangement from which that pension credit was derived.]

Textual Amendments

F1 Reg. 6 substituted (1.12.2000) by The Pension Sharing (Consequential and Miscellaneous Amendments) Regulations 2000 (S.I. 2000/2691), regs. 1, 11(3)

F2 Words in reg. 6(2) substituted (6.4.2006) by Taxation of Pension Schemes (Consequential Amendments of Occupational and Personal Pension Schemes Legislation) Order 2006 (S.I. 2006/744), art. 1, 17(2)