The Occupational Pension Schemes (Transfer Values) Regulations 1996

Manner of calculation and verification of cash equivalents - general provisions E+W+S

[F1 7 .— (1) Subject to paragraphs (4) and (7), cash equivalents are to be calculated and verified—

(a) by calculating the initial cash equivalent—

(i) for salary related benefits [F2 other than cash balance benefits in respect of which the available sum is not calculated by reference to final salary], in accordance with regulations 7A and 7B; F3 ...

(ii) for [F4 cash balance benefits and money purchase benefits other than collective money purchase benefits, or] [F5 in respect of which the available sum is not calculated by reference to final salary], in accordance with regulation 7C,

[F6 (iii) for collective money purchase benefits, in accordance with regulation 7ZC,]

and then making any reductions in accordance with regulation 7D; or

(b) in accordance with regulation 7E.

(2) The trustees must decide whether to calculate and verify the cash equivalent in accordance with paragraph (1)(a) or (b), but they can only choose paragraph (1)(b) if they have had regard to any requirement for consent to paying a cash equivalent which is higher than the amount calculated and verified in accordance with paragraph (1)(a).

(3) The trustees are responsible for the calculation and verification of cash equivalents and initial cash equivalents.

(4) Where a member, in relation to whom a cash equivalent is to be calculated and verified, is a member of a scheme modified by—

(a) the British Coal Staff Superannuation Scheme (Modification) Regulations 1994; or

(b) the Mineworkers’ Pension Scheme (Modification) Regulations 1994,

the cash equivalent of his bonus is to be calculated and verified by the trustees, having obtained the advice of the actuary, to reflect the fact that a reduced bonus, or no bonus, may become payable in accordance with the provisions governing the scheme in question.

(5) For the purposes of paragraph (4) “bonus” means any—

(a) augmentation of his benefits; or

(b) new, additional or alternative benefits,

which the trustees of the scheme in question have applied to the member’s benefits, or granted to him in accordance with the provisions governing that scheme, on the basis of findings as to that scheme’s funding position.

(6) Paragraph (7) applies where the cash equivalent is calculated and verified in accordance with paragraph (1)(a).

[F7 (7) Where the cash equivalent relates to more than one of the benefits specified in paragraphs (1)(a)(i) to (1)(a)(iii), the initial cash equivalent is to be calculated—

(a) for the portion falling within paragraph (1)(a)(i), in accordance with regulations 7A and 7B;

(b) for the portion falling within paragraph (1)(a)(ii), in accordance with regulation 7C; and

(c) for the portion falling within paragraph (1)(a)(iii), in accordance with regulation 7ZC.]]

Textual Amendments

F1 Regs. 7-7E substituted for reg. 7 and 8 (E.W.S.) (1.10.2008) by Occupational Pension Schemes (Transfer Values) (Amendment) Regulations 2008 (S.I. 2008/1050), regs. 1(1), 4

F2 Words in reg. 7(1)(a)(i) inserted (E.W.S.) (24.7.2014) by The Pensions Act 2011 (Transitional, Consequential and Supplementary Provisions) Regulations 2014 (S.I. 2014/1711) , regs. 1(1) , 32(3)(a) (with regs. 6 , 41 , 44(1) , 47(1) , 69(2) , 72(1) , 76(1) ); coming into force immediately after s. 29 of 2011 c 19 - see S.I. 2014/1683, art. 2

F3 Word in reg. 7(1)(a)(i) omitted (1.8.2022) by virtue of The Occupational Pension Schemes (Collective Money Purchase Schemes) (Modifications and Consequential and Miscellaneous Amendments) Regulations 2022 (S.I. 2022/337), regs. 1(3), 3(4)(a)

F4 Words in reg. 7(1)(a)(ii) substituted (1.8.2022) by The Occupational Pension Schemes (Collective Money Purchase Schemes) (Modifications and Consequential and Miscellaneous Amendments) Regulations 2022 (S.I. 2022/337), regs. 1(3), 3(4)(b)

F5 Words in reg. 7(1)(a)(ii) inserted (E.W.S.) (24.7.2014) by The Pensions Act 2011 (Transitional, Consequential and Supplementary Provisions) Regulations 2014 (S.I. 2014/1711) , regs. 1(1) , 32(3)(b) (with regs. 6 , 41 , 44(1) , 47(1) , 69(2) , 72(1) , 76(1) ); coming into force immediately after s. 29 of 2011 c 19 - see S.I. 2014/1683, art. 2

F6 Reg. 7(1)(a)(iii) inserted (1.8.2022) by The Occupational Pension Schemes (Collective Money Purchase Schemes) (Modifications and Consequential and Miscellaneous Amendments) Regulations 2022 (S.I. 2022/337), regs. 1(3), 3(4)(c)

F7 Reg. 7(7) substituted (1.8.2022) by The Occupational Pension Schemes (Collective Money Purchase Schemes) (Modifications and Consequential and Miscellaneous Amendments) Regulations 2022 (S.I. 2022/337), regs. 1(3), 3(4)(d)

Modifications etc. (not altering text)

C1 Regs. 7-7C modified by SI 2000/1054 reg. 24(2)(c) (as substituted (E.W.S.) (1.10.2008) by Occupational Pension Schemes (Transfer Values) (Amendment) Regulations 2008 (S.I. 2008/1050) , reg. 1(1) , Sch. 2 para. 7(c) )

C2 Regs. 7-7C modified by S.I. 2000/1048, reg. 3(3)(4)(8) (as substituted (6.4.2016) by The Pension Sharing (Miscellaneous Amendments) Regulations 2016 (S.I. 2016/289), regs. 1(2), 2(4)(b), (c))

C3 Regs. 7-7C modified by S.S.I. 2000/112, reg. 3(3)(4)(8) (as substituted (6.4.2016) by The Pension Sharing (Miscellaneous Amendments) Regulations 2016 (S.I. 2016/289), regs. 1(2), 7(3)(b), (e))

C4 Regs. 7-7C modified by S.I. 2000/1052, reg. 4 (as substituted (6.4.2016) by The Pension Sharing (Miscellaneous Amendments) Regulations 2016 (S.I. 2016/289), regs. 1(2), 4(4))