SCHEDULES
SCHEDULE 29

Registered pension schemes: authorised lump sums—supplementary
Part 1

Lump sum rule

Transitional 2013/14 lump sum, and its related trivial commutation lump sum
11A
1
A lump sum is a transitional 2013/14 lump sum for the purposes of this Part if—
a
the sum (“the earlier sum”) is paid to the member in connection with a pension under a registered pension scheme to which it is expected that the member will become entitled (“the expected pension”),
b
the earlier sum is paid before the member becomes entitled to the expected pension,
c
either—
i
the earlier sum is paid on or after 19 September 2013 but before 27 March 2014, or
ii
the earlier sum is paid before 19 September 2013, a contract for a lifetime annuity is entered into to provide the expected pension, and on or after 19 March 2014 the contract is cancelled,
d
all of the sums and assets for the time being representing the sums and assets that when the earlier sum was paid were held for the purpose of providing the expected pension are, before the member becomes entitled to the expected pension, used in paying a further lump sum to the member (
“ the further sum ”
),
e
the further sum is paid on or after 6 July 2014 but before 6 April 2015, and
f
the further sum is a trivial commutation lump sum (see sub-paragraph (2)).
2
Sub-paragraph (4) applies when deciding under paragraph 7 whether the further sum is a trivial commutation lump sum in a case where the earlier sum is paid before the nominated date (see paragraph 7(3) for the meaning of “the nominated date”).
3
If the earlier sum is a transitional 2013/14 lump sum, and the earlier sum and the further sum are not the only lump sums paid under registered pension schemes to the member, sub-paragraph (4) applies when deciding under paragraph 7 whether any other lump sum paid under a registered pension scheme to the member is a trivial commutation lump sum.
4
If this sub-paragraph applies, the payment of the earlier sum is to be treated for the purposes of paragraph 8(1)(b) as a benefit crystallisation event—
a
which occurs when the earlier sum is paid, and
b
on which the amount crystallised is the amount of the earlier sum.
5
If the earlier sum is a transitional 2013/14 lump sum, and only the sums and assets mentioned in sub-paragraph (1)(d) are used in paying the further sum, section 636B of
ITEPA
2003 applies in relation to the further sum with the omission of its subsection (3).
6
If the earlier sum is a transitional 2013/14 lump sum, and the sums and assets mentioned in sub-paragraph (1)(d) are used together with other sums and assets in paying the further sum—
a
section 636B of
ITEPA
2003 applies in relation to the further sum as if instead of the further sum there were two separate trivial commutation lump sums as follows—
i
one (“the first part of the further sum”) consisting of so much of the further sum as is attributable to the sums and assets mentioned in sub-paragraph (1)(d), and
ii
another consisting of the remainder of the further sum,
b
the first part of the further sum is to be treated for the purposes of section 636B of
ITEPA
2003 as having been paid immediately before the remainder of the further sum,
c
section 636B of
ITEPA
2003 applies in relation to the first part of the further sum with the omission of its subsection (3), and
d
for the purposes of applying section 636B(3) of
ITEPA
2003 in relation to the remainder of the further sum, the rights to which the first part of the further sum relates are to be treated as rights that are not uncrystallised rights immediately before the remainder of the further sum is paid.
7
For the purposes of sub-paragraph (1), if the circumstances are as described in sub-paragraph (1)(c)(ii), the member is treated as not having become entitled to the expected pension as a result of the cancelled contract having been entered into.
Sch. 29 modified (6.4.2006) by The Pensions Schemes (Application of UK Provisions to Relevant Non-UK Schemes) Regulations 2006 (S.I. 2006/207), regs. 1(1), 15 (as amended: (13/8/2009) by S.I. 2009/2047, regs. 1(1), 2-10; (with effect in accordance with reg. 1(3) of the amending S.I.) by S.I. 2012/1795, regs. 1(1), 6; (with effect in accordance with Sch. 1 para. 96(16)(a) of the amending Act) by 2014 c. 30, Sch. 1 para. 96(3)-(14) (with Sch. 1 para. 96(16)(b)); and (for the tax year 2024-25 and subsequent tax years) by 2024 c. 3, Sch. 9 paras. 62(6), 124 (with Sch. 9 paras. 125-132A) (as amended by S.I. 2024/356, regs. 1, 4))
Sch. 29 Pt. 1 modified (6.4.2006) by The Taxation of Pension Schemes (Transitional Provisions) Order 2006 (S.I. 2006/572), arts. 1(1), 25(1)(2)(4)
Sch. 29 para. 11A and cross-heading inserted (19.3.2014) by Finance Act 2014 (c. 26), Sch. 5 paras. 5(2), 15
Sch. 29 modified by The Taxation of Pension Schemes (Transitional Provisions) Order 2006 (S.I. 2006/572), art. 23C (as inserted (1.6.2009) by S.I. 2009/1172, arts. 1, 3 (as amended (with effect in accordance with s. 42(9) of the amending Act) by Finance Act 2014 (c. 26), s. 42(5); and as amended by Taxation of Pensions Act 2014 (c. 30), Sch. 1 para. 72(1) (with Sch. 1 para. 72(2)(b)))
Sch. 29 Pt. 1 applied (with modifications) (6.4.2006) by The Pension Protection Fund (Tax) Regulations 2006 (S.I. 2006/575), regs. 1, 11