The Teachers’ Pensions Regulations 2010

Commutation: small pensions

119.—(1) Where—

(a)a retirement pension is payable to a person (P), and

(b)the conditions set out in paragraph (4) are satisfied

the Secretary of State may, on the application of P, commute that pension and any phased retirement pension additional pension or total incapacity pension paid with that pension by paying a lump sum to P.

(2) But no payment may be made under paragraph (1) if the pension includes a guaranteed minimum unless P has reached GMP age.

(3) Where a lump sum is paid under paragraph (1) neither a death grant under Part 8 (death grants) nor a pension under Part 9 (family benefits) is payable on P’s death,

(4) The conditions in this paragraph are that—

(a)the lump sum is a trivial commutation lump sum as defined in paragraph 7 of Schedule 29 to FA 2004 or falls within regulation 11 or 12 of the Registered Pension Schemes (Authorised Payments) Regulations 2009(1),

(b)the application is made at the same time as P makes an application under regulation 107,

(c)no transfer value has been accepted from the scheme managers of a personal pension scheme under regulation 35,

(d)during the period of 5 years ending with the application no other transfer value has been accepted, and

(e)during the period of 3 years ending with the application no cash equivalent or transfer value has been paid in respect of P.

(5) Where—

(a)a pension credit retirement pension becomes payable to a pension credit member, and

(b)the conditions set out in paragraph (6) are satisfied

the Secretary of State may, on the application of the pension credit member commute the pension by paying a lump sum to the pension credit member.

(6) The conditions in this paragraph are that—

(a)the lump sum is a trivial commutation lump sum as defined in paragraph 7 of Schedule 29 to FA 2004 or falls within regulation 11 or 12 of the Registered Pension Schemes (Authorised Payments) Regulations 2009, and

(b)the application is made at the same time as the pension credit member makes an application under regulation 107,

(7) Where—

(a)a pension is payable to a person (“the family member”) under Part 9 (family benefits), and

(b)the conditions set out in paragraph (8) are satisfied

the Secretary of State, may on the application of the family member commute that pension by paying a lump sum to the family member.

(8) The conditions are that—

(a)D had not reached the age of 75 at the date of D’s death,

(b)D would not have reached the age of 75 when the lump sum is paid,

(c)the application is made at the same time as the family member makes an application under regulation 107,

(d)the lump sum does not exceed 1% of the standard lifetime allowance on the day that the lump sum would otherwise be paid,

and in this paragraph D is the person who had been in pensionable employment and on whose death the family benefits became payable.

(9) The lump sums referred to in paragraphs (1), (5) and (7) are to be determined by the Secretary of State after taking advice from the scheme actuary.