The Retirement Benefits Schemes (Sharing of Pensions on Divorce or Annulment) Regulations 2000

Modifications of Schedule 10 as regards members who are not moderate earners—schemes providing lump sums otherwise than by the commutation of a part of a pension

7.—(1) In the circumstances prescribed by paragraph (2), Schedule 10 shall apply to a scheme as regards an employee within that paragraph with the modifications prescribed by paragraph (3).

(2) The circumstances prescribed by this paragraph are circumstances where the employee—

(a) is a member of a scheme which—

(i) is not a simplified defined contribution scheme; and

(ii) provides him with a lump sum otherwise than by the commutation of a part of a pension;

(b) is an ex-spouse whose rights under the scheme have been debited as a consequence of a pension sharing order or provision;

(c) is not a moderate earner; and

(d) is not an employee within regulation 8(2)(b).

(3) The modifications prescribed by this paragraph are that—

(a) in paragraph 18(5) of Schedule 10—

(i) the words “and (da)” shall be omitted; and

(ii) at the end after the words “the Taxes Act 1988” there shall be added the words “and provision of the description set out in sub-paragraph (5A) below”; and

(b) after paragraph 18(5) of Schedule 10 there shall be inserted the following sub-paragraph—

“(5A) The description of provision referred to in sub-paragraph (5) above is provision providing that in a case in which—

(a) a lump sum may be obtained otherwise than by the commutation of a part of a pension provided for an employee, and

(b) the amount of that pension is affected by the making of a pension sharing order or provision,

the lump sum does not exceed the sum produced by multiplying by 3 the amount which (after effect has been given to the pension sharing order or provision) is the amount of the pension for the first year in which it is payable calculated in accordance with section 590(4E)(1) of the Taxes Act 1988.”

(1)

Section 590(4E) was inserted by paragraph 2(8) of Schedule 10 to the Finance Act 1999.