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The Local Government Pension Scheme Regulations (Northern Ireland) 2014

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Additional voluntary contributions

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19.—(1) An active member may enter into arrangements to pay additional voluntary contributions (“AVCs”) or to contribute to shared cost additional voluntary contribution arrangements (“SCAVCs”) in respect of an employment.

(2) The arrangements mentioned in paragraph (1) shall be a scheme established under an agreement between the Committee and a body approved for the purposes under the 2004 Finance Act (“the AVC provider”), registered in accordance with the 2004 Finance Act and administered in accordance with the 2004 Finance Act, the 2004 Pensions Act and the Pensions (Northern Ireland) Order 2005(1).

(3) Where an active member wishes to make contributions to an arrangement under paragraph (1) that active member, or the AVC provider authorised by the active member to act on that active member’s behalf, shall specify in a written notice given both to the Committee and the active member’s employing authority, if the active member is not employed by the Committee—

(a)the percentage of pensionable pay or the amount that the member wishes to contribute from pensionable pay in respect of an employment in each pay period (but see paragraph (4); and

(b)whether any of the contributions are to be used to provide life assurance benefits payable upon death in service as an active member and, if so, the proportion or amount to be so used.

(4) Where a member is paying AVCs for life assurance and where the pensionable pay in a pay period, net of any deductions made by the employing authority, is less than the AVC due, the member may pay the contribution due by way of a payment directly to the AVC provider or to the employing authority for onward transmission to that body in order to ensure that the life assurance cover continues.

(5) A member may vary the amount specified in, or cease contributing to, an arrangement by service of a further written notice given to the member’s employing authority and the Committee by the member or by the AVC provider authorised by that member to act on that member’s behalf.

(6) For the purposes of regulation 17 of the Occupational and Personal Pension Schemes (Disclosure of Information) Regulations (Northern Ireland) 2014(2) the retirement date used for the purposes of Schedule 6 to those regulations is, where no acceptable date has been specified for that purpose by the member, normal pension age or, if the member has already attained normal pension age, age 75.

(7) If a member draws benefits under regulation 31(1), (2), (4), (5), (7), (10), (11), (12) (retirement benefits) or regulation 36 (early payment of retirement pension on ill-health grounds: active members) or, if a member who draws benefits under regulation 31(6) (retirement benefits, flexible retirement pensions) makes an election to draw the realisable value in the AVC arrangement at the same time, that member shall notify the Committee in writing that the realisable value, under arrangements made under this regulation,—

(a)is to be taken in full or in part by the member as a lump sum, and where only part is taken as a lump sum, the member shall specify the amount to be so taken; or

(b)to the extent that the realisable value has not been taken as a lump sum, it is to be used—

(i)to purchase additional pension under the Scheme, the amount of which is to be determined by the Committee in accordance with actuarial guidance issued by the Department; or

(ii)to purchase an annuity from one or more insurance companies (within the meaning of section 275 of the 2004 Finance Act.

(8) Where a member chooses to take some or all of the benefits referred to in paragraph (7) in the form of a lump sum, that sum does not form part of the total amount referred to in regulation 34(2) (election for lump sum instead of pension).

(9) A person with an arrangement under paragraph (1) who becomes a deferred member of the Scheme is entitled to a deferred AVC account with the AVC provider.

(10) A member shall transfer the realisable value in a deferred AVC account to another registered pension scheme or qualified recognised overseas pension scheme if making a transfer under regulation 108 (rights to payment out of pension fund).

(11) Where a member aggregates a deferred member’s pension account or a deferred refund account with an active member’s pension account, the realisable value in any deferred AVC account shall be transferred to an arrangement under this regulation and the member may make an election to make further payments to the arrangement.

(12) If—

(a)an active member who is paying contributions to an AVC or SCAVC for the purpose of life assurance dies;

(b)an active member who is paying contributions to an AVC or SCAVC other than for the purpose of life assurance dies;

(c)a deferred member dies and has a deferred AVC account attached to the deferred member’s pension account;

(d)a pension credit member, who has been awarded a share of a member’s AVC account, dies before drawing benefits; or

(e)a member who has made an election under paragraph (7)(b)(ii) dies before the annuity has been purchased,

the Committee shall decide that any life assurance sum due under sub-paragraph (a), and the realisable value of any arrangement under sub-paragraphs (b) to (e) should be paid to or for the benefit of the member’s nominee, personal representatives or any person appearing to the Committee to have been a relative or dependent of the member.

(13) Where a member has attained the age of 75 at the date of death, any tax chargeable under section 206 of the 2004 Finance Act (special lump sum death benefits charge) is to be deducted from the payment due under paragraphs (12) or (14).

(14) If the total of payments due under paragraph (12) have not been paid before the expiry of two years beginning with the date of the member’s death or, where the Committee did not know about the member’s death within that period, beginning with the date on which the Committee could reasonably have been expected to have become aware of the member’s death, an amount equal to the shortfall shall be paid to the member’s personal representatives.

(15) Regulations 80 (first instance decisions - general) and 102 (forfeiture of pension rights after conviction for employment-related offences) do not apply in relation to an annuity purchased under paragraph (7)(b)(ii) and regulation 21(1)(b) (exclusion of rights to return of contributions) does not apply to any AVCs paid by the member.

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