PART 11Payment of surplus funds to employer

Failure to comply with the requirements of section 37 or 76 of the 1995 Act: periods before the appointed dayI137

1

Where the conditions specified in paragraph (2) are met neither—

a

section 37 of the 1995 Act (payment of surplus to employer)72; nor

b

section 76 of that Act (excess assets on winding up)73,

(as the case may be) apply in respect of a payment from scheme funds made to the employer in relation to the scheme.

2

The conditions specified in this paragraph are that—

a

the trustees of a trust scheme have exercised a power under the scheme rules to make a payment to the employer out of funds held for the purposes of the scheme and that payment was made to the employer before the appointed day;

b

at the time that the payment was made to the employer the scheme included—

i

cash balance benefits; or

ii

pensions derived from money purchase or cash balance benefits;

c

no benefits other than those specified in sub-paragraph (b), money purchase benefits and death benefits secured by insurance policies or annuity contracts; and

d

the trustees of the scheme treated the scheme as if it were a money purchase scheme and for that reason did not comply with the requirements—

i

for schemes not in winding up, of section 37 of the 1995 Act; or

ii

for schemes in winding up, of section 76 of that Act,

before exercising the power to make a payment to the employer.