Finance Act 2000

Income withdrawals: the relevant date E+W+S+N.I.

10 (1) Amend section 634A as follows. E+W+S+N.I.

(2) In subsection (4) (which, for each successive period of twelve months beginning with the member’s pension date, imposes limits on income withdrawals by reference to the annual amount of the annuity purchasable on the relevant reference date)—

(a) for “beginning with his pension date" substitute “ in each valuation period ”; and

(b) for “on the relevant reference date" substitute—

“(a) in the case of the initial period, on the relevant reference date; and

(b) in the case of any subsequent valuation period, on a particular day in the period of sixty days ending with the relevant reference date”.

(3) For subsection (5) (the relevant reference date) substitute—

“(5) For the purposes of this section, in the case of any arrangements the relevant reference date—

(a) for the period beginning with the member’s pension date (“the initial period”), is that pension date; and

(b) for each succeeding period, is the first day of the period;

and, subject to subsection (5D) below, any period mentioned in paragraph (a) or (b) above (a “valuation period”) is a period of three years.”.

(4) After subsection (5) insert—

“(5A) Where—

(a) a member has made an election under subsection (1) above in respect of two or more personal pension arrangements under the same personal pension scheme, and

(b) in the case of one or more of those arrangements, the relevant reference date for any valuation period after the initial period would not, apart from this subsection, coincide with a date which is (or, but for the ending of the period of deferral, would be) the relevant reference date for a valuation period in the case of the arrangements with the earliest pension date,

the relevant reference date for any valuation period other than the initial period, and the valuation period to which that date relates, shall, if the scheme or the arrangements so require, be determined in the case of all those arrangements on the assumption that the pension date is in each case the same as in the case of the arrangements with the earliest pension date.

(5B) In determining in accordance with subsection (5A) above the relevant reference date and the valuation period to which it relates, in the case of any arrangements (“the relevant arrangements”), there shall be left out of account any arrangements in whose case the period of deferral ended—

(a) before the actual pension date in the case of the relevant arrangements; or

(b) before the date on which the relevant arrangements first become subject to such a requirement as is mentioned in subsection (5A) above.

(5C) But where, in the case of any arrangements,—

(a) the relevant reference date for any valuation period falls to be determined, in accordance with the assumption in subsection (5A) above, by reference to the pension date for any other arrangements, and

(b) the period of deferral in the case of those other arrangements comes to an end,

the same pension date shall continue to be assumed under that subsection for that and any subsequent valuation period, notwithstanding the coming to an end of the period of deferral in the case of those other arrangements (and references in subsection (5A) to the arrangements with the earliest pension date shall be construed accordingly).

(5D) Where, in the case of any personal pension arrangements, in consequence of subsection (5A) above the relevant reference date for any valuation period (“the later date”) falls less than three years after the relevant reference date for the previous valuation period (“the earlier date”)—

(a) the valuation period beginning with the earlier date shall end with the day before the later date; and

(b) subsection (4) above shall apply in relation to any portion of the period which remains after the completion of any successive periods of twelve months as if it were a period of twelve months.”.

(5) Sub-paragraphs (2)(a) and (3) have effect on and after 1st October 2000.

(6) Sub-paragraphs (2)(b) and (4) have effect in relation to personal pension arrangements—

(a) under any personal pension scheme to which approval under Chapter IV of Part XIV of the Taxes Act 1988 is given on or after 1st October 2000; or

(b) under any existing approved scheme amended on or after that date, with the approval of the Board under that Chapter, for the purpose of—

(i) conforming to the amendment made by sub-paragraph (2)(b), or

(ii) imposing such a requirement as is mentioned in the subsection (5A) inserted by sub-paragraph (4),

as the case may be.

(7) In this paragraph “existing approved scheme” means a personal pension scheme approved under Chapter IV of Part XIV of the Taxes Act 1988 before 1st October 2000.