Finance Act 2024

Amendments of Part 3 of Schedule 36 to FA 2004

83 (1) Paragraph 28 (pre-commencement benefit rights: no enhanced protection: permitted maximum) is amended as follows.

(2) In sub-paragraph (1) omit “paragraph 2 of”.

(3) In sub-paragraph (2), after “paragraph 2” insert “of Schedule 29”.

(4) For sub-paragraph (3) substitute—

“(3) Otherwise, for paragraph 2 of Schedule 29 substitute—

“2 (1) In paragraph 1 “the permitted maximum”, in relation to a lump sum, means an amount equal to—

where—

• A is the value of the individual’s relevant uncrystallised lump sum rights on 5 April 2006 (calculated in accordance with paragraphs 25 and 26), as adjusted under sub-paragraph (2);

• B is the aggregate of the amounts of each pension commencement lump sum to which the individual has previously become entitled, as adjusted under sub-paragraph (3) (or, if the individual has not previously become entitled to a pension commencement lump sum, is nil).

(2) The adjustment referred to in the definition of A is the multiplication of the value of the individual’s relevant uncrystallised lump sum rights on 5th April 2006 by 1.2 (being £1,800,000 divided by £1,500,000).

(3) The adjustment of the amount of a pension commencement lump sum to which the individual has previously become entitled referred to in the definition of B is the multiplication of the amount by—

where C is—

(a)

if the individual became entitled to the lump sum before 6th April 2012, the standard lifetime allowance at that time;

(b)

otherwise, £1,800,000.””