68. A pension credit member (P) of this scheme is entitled to the immediate payment for life of a pension credit member’s pension under this scheme if—
(a)P has reached normal pension age;
(b)the pension sharing order under which P is entitled to the pension credit has taken effect; and
(c)P has claimed payment of the pension.
69.—(1) This regulation applies in relation to a pension credit member (P) who—
(a)has reached normal minimum pension age; and
(b)has not reached normal pension age under this scheme.
(2) P may claim early payment of a pension credit member’s pension by notice to the scheme manager in a form required by the scheme manager.
(3) A claim for early payment must specify the date on which payment of the pension is claimed (“the claim date”).
(4) P is entitled to the immediate payment for life of a pension credit member’s pension on the claim date if the scheme manager is reasonably satisfied that on that date the requirements of regulation 7(5) (early retirement or deferred retirement) of the Pension Sharing (Pension Credit Benefit) Regulations 2000(1) are met.
70.—(1) Benefits that are attributable (directly or indirectly) to a pension credit may not be aggregated with any other benefit to which a pension credit member is entitled under this scheme.
(2) If a pension credit member is a dual capacity member, the benefits that are payable to or in respect of the member in each of the member’s capacities are treated separately for the purposes of these Regulations.
71. The annual rate of a pension credit member’s pension is calculated by—
(a)taking the amount of credited pension specified in the pension credit member’s account;
(b)subtracting the early payment reduction (if any) specified in that account in relation to that amount; and
(c)subtracting the commutation amount (if any) specified in that account in relation to that amount.
72.—(1) A pension credit member who becomes entitled to payment of a pension credit member’s pension under this scheme may, subject to paragraph (5), opt to exchange part of the pension for a lump sum.
(2) The option under this regulation may only be exercised—
(a)by notice to the scheme manager in a form required by the scheme manager; and
(b)before the first payment of the pension is made.
(3) If a pension credit member exercises the option under this regulation, for every £1 by which the amount of the member’s annual rate of pension is reduced, the member must be paid a lump sum of £12.
(4) This regulation does not apply if the pension debit member from whose rights the pension is derived received a lump sum under this Part before the date on which the pension sharing order takes effect.
(5) For the purposes of paragraph (1) the part of the pension exchanged must not exceed 35.7% of the overall value of the pension.
73.—(1) This regulation applies to a pension credit member who can show, to the satisfaction of the scheme manager, that they have a life expectancy of less than 12 months.
(2) The pension credit member may opt to exchange the whole of the pension credit member’s pension under this scheme for a lump sum.
(3) The option under this regulation (“this option”) may only be exercised—
(a)by notice to the scheme manager in a form required by the scheme manager; and
(b)before the first payment of the pension is made.
(4) The lump sum—
(a)is an amount equal to the total annual amount of the pension credit member’s pension, multiplied by 5; and
(b)must be paid to the pension credit member as soon as is reasonably practicable after this option is exercised.
(5) In this regulation, “total annual amount” in relation to a pension credit member’s pension means the total of—
(a)the annual rate of pension to which the member would be entitled if they had not exercised this option, calculated as at the date this option is exercised, but without subtracting the early payment reduction (if any); and
(b)the amount of increase (if any) in the annual rate of that pension under PIA 1971 calculated as at that date.
74.—(1) Where a pension credit member (P) has exercised the option under either regulation 72(1) (option for pension credit member to commute part of pension) or 73(2) (option for pension credit member to commute whole pension (serious ill-health)), P is entitled to be paid an additional amount (a “commutation supplement”) calculated under paragraph (2).
(2) The sum payable to P is an amount sufficient, after deduction of any applicable income tax and national insurance payable by P arising as a result of such payment, to result in P receiving a net sum equal to—
(a)the income tax payable by P on any lump sum payable under either regulation 72(1) or 73(2) that relates only to uncrystallised rights under this scheme; plus
(b)the national insurance contributions payable by P (if any) in relation to the lump sum received pursuant to either of those regulations.
(3) The commutation supplement is payable at the same time as payment of the lump sum.
(4) In this regulation, “uncrystallised rights” has the meaning given in section 212 of the FA 2004.
S.I. 2000/1054. Regulation 7 was amended by S.I. 2009/615.