The Taxation of Pension Schemes (Transitional Provisions) Order 2006

Dependant’s unsecured pension funds

30.—(1) In the case of an individual who meets the conditions set out in paragraph (2), paragraphs (3) and (4) apply.

(2) The conditions are as follows.

• Condition A

  The individual had not reached the age of 75 on the 6th April 2006.

• Condition B

  The individual is a dependant of a member who was a member of scheme which falls within paragraph 1(1) of Schedule 36.

• Condition C

  On 5th April 2006 the individual was, under an arrangement which was not a defined benefits arrangement—

  (a)

  entitled to a pension which took the form of income drawdown under a retirement benefits scheme approved for the purposes of Chapter 1 of Part 14 of ICTA;

  (b)

  entitled to a pension that was paid from the resources of—

  (i)

  small self-administered scheme as defined in the Retirement Benefits Schemes (Restriction on Discretion to Approve) (Small Self-administered Schemes) Regulations 1991, or

  (ii)

  a small self-administered scheme that had been approved under section 590 of ICTA,

  and the rules of the scheme on 5th April 2006 did not require the purchase of an annuity in respect of the individual;

  (c)

  entitled to a pension which took the form of income withdrawal under a personal pension scheme approved under Chapter 4 of Part 14 of ICTA pursuant to section 636A(1) of that Act; or

  (d)

  prospectively entitled to an annuity payment of which has been deferred pursuant to section 636(5) of ICTA.

(3) Paragraph 22(2) of Schedule 28 (dependant’s unsecured pension fund) is modified as follows—

(a)at the end of sub-paragraph (1)(a) omit word “and”,

(b)omit sub-paragraph (1)(b),

(c)in sub-paragraph (2)—

(i)for paragraphs (a) and (b) substitute—

“(a)have at any time been applied to provide a pension which —took the form of income drawdown under a retirement benefits scheme approved for the purposes of Chapter 1 of Part 14 of ICTA;

(b)have at any time been applied to provide a pension which was paid from the resources of—

(i)a small self-administered scheme as defined in the Retirement Benefits Schemes (Restriction on Discretion to Approve) (Small Self-administered Schemes) Regulations 1991, or

(ii)a small self-administered scheme that had been approved under section 590 of ICTA

and the rules of scheme on 5th April 2006 did not require the purchase of an annuity in respect of the individual;

(c)have at any time been applied to provide a pension which took the form of income withdrawal under a personal pension scheme approved under Chapter 4 of Part 14 of ICTA pursuant to section 636A(3)of that Act; or

(d)have, immediately before the coming into force of this Part,been held for the purpose of providing an annuity, payment of which has been deferred in accordance with section 636(5) of that Act..”.

(4) For 23(1) (unsecured pension year and basis amount for unsecured pension year) of Schedule 28 substitute—

“23.—(1) “Unsecured pension year”, in relation to a dependant’s unsecured pension referred to in paragraph 22(2) as modified by article 30 of the Taxation of Pension Schemes (Transitional Provisions) Order 2006, means—

(a)the period beginning on 6th April 2006 and ending on the earlier of—

(i)5th April 2007 or

(ii)the date that the first reference period defined in paragraph 24(1A), as modified by article 5 of the 2006 Order, terminates, and

(b)each succeeding period of 12 months.”.