The Teachers' Superannuation (Additional Voluntary Contributions) Regulations 1989

Regulation 11(7)

SCHEDULE 1PENSION PROVIDERS

• The Company

• Eagle Star Insurance Company Limited

• The Equitable Life Assurance Society

• Legal and General Assurance Society Limited

• The Norwich Union Life Insurance Society

• Pearl Assurance PLC

• Scottish Widows' Fund and Life Assurance Society

• The Standard Life Assurance Company

• Sun Alliance Insurance Group

• Sun Life Assurance Society PLC

Regulation 13

SCHEDULE 2BENEFIT LIMITS

PART Iinterpretation

1.  Paragraphs 2 to 5 have effect for defining expressions used in this Schedule.

2.  “Total retirement benefits” means the total of so much of–

(a)the annual rate of the participator’s retirement pension under these Regulations, and

(b)the annual rate of any retirement pension under the 1988 Regulations, and

(c)the actuarial equivalent as an annual pension of any retirement lump sum under the 1988 Regulations,

as is not attributable to the receipt of any transfer value, together with the annual rate of any pension payable to him under a free-standing additional voluntary contributions scheme.

3.—(1) “Final remuneration” means the greater of A and B, where–

Ais the participator’s highest year’s adjusted earnings in respect of pensionable employment, or earnings in respect of a period of contribution under regulation C8 of the 1988 Regulations, during the period of 5 years ending on the material date, and

Bis the average of his total taxable earnings for any period of 3 or more consecutive years ending no earlier than 10 years before the material date,

but, in respect of any year other than the one ending on the material date, earnings are to be taken to have been increased in proportion to any increase in the Index from the end of the year up to the material date.

(2) In this paragraph “adjusted earnings” means C+D, where–

Cis the participator’s total taxable earnings for the year in question less any bonus payments and payments for overtime (“fluctuating emoluments”), and

Dis the average, for a period ending with the year in question, of any fluctuating emoluments; the period is one of at least 3 years or, if shorter, the period during which the fluctuating emoluments have been payable,

and “the material date” means the earliest of–

(a)the retirement date,

(b)the date on which the retirement pension under these Regulations commenced, and

(c)the date on which the participator ceased to be in pensionable employment or, as the case may be, to contribute under regulation C8 of the 1988 Regulations.

4.—(1) “Retained benefits” means the total of any pensions payable to the participator–

(a)in respect of employment before he entered pensionable employment, under a retirement benefits scheme or under an annuity contract falling within section 431(4)(d) of the Taxes Act, or

(b)under a retirement annuity contract or trust scheme approved under Chapter III of Part XIV of the Taxes Act,

and so much of any pension payable to him under these Regulations or the 1988 Regulations as is attributable to a transfer value received from any such scheme or on the termination of any such contract.

(2) In this paragraph “pension” includes the actuarial equivalent as an annual pension of any lump sum.

5.  “Relevant employment” comprises employment falling within Schedule 2 to the 1988 Regulations and employment in an accepted school within the meaning of regulation B4 of those Regulations.

PART IIretirement pensions

6.  The annual rate of a participator’s retirement pension under these Regulations must not be such as to cause his total retirement benefits to exceed the permitted amount.

7.—(1) If the participator retires on his 60th birthday, the permitted amount is the greater of E and F, where–

Eis 1/60th of his final remuneration for each of up to 40 years of relevant employment, and

Fis the lesser of G and H.

(2) In sub-paragraph (1)–

Gis 1/30th of his final remuneration for each of up to 20 years of relevant employment, and

His 2/3rds of his final remuneration less any retained benefits.

8.  If the participator retires on a date later than his 60th birthday, the permitted amount is the greatest of J, K and, where applicable, L, where–

Jis an amount calculated in accordance with paragraph 7 as at that date,

Kis an amount calculated in accordance with paragraph 7 as at his 60th birthday increased, up to that date, either actuarially or in proportion to any increase in the Index, and

Lis, in the case of a participator with more than 40 years of relevant employment, 1/60th of his final remuneration for each of up to 45 years of relevant employment, excluding any years before his 60th birthday in excess of 40.

9.—(1) If the participator retires after having, before his 60th birthday, ceased to be in relevant employment, the permitted amount is the greater of (M+R) and

(2) For the purposes of sub-paragraph (1) the appropriate increase is an increase in the amount in question, either–

(a)in proportion to any increase in the Index, or

(b)if greater, at 5 per cent compound,

from the cessation of relevant employment to the date on which the pension commenced.

PART IIIdependant’s pensions

10.—(1) The annual rate of a dependant’s pension under these Regulations, or where more than one such pension is payable the total of their annual rates, must not be such as to cause the total of the annual rates of the relevant benefits to exceed the permitted amount.

(2) Where only one dependant’s pension is payable, the relevant benefits are–

(a)that pension,

(b)any similar pension payable to the dependant under the 1988 Regulations or under a free-standing additional voluntary contributions scheme to which contributions were paid while the participator was in pensionable employment, and

(c)any retained benefits,

and the permitted amount is 2/3rds of the annual rate of the maximum retirement pension.

(3) Where two or more dependant’s pensions are payable, the relevant benefits are–

(a)those pensions,

(b)any similar pensions payable as mentioned in sub-paragraph (2)(b), and

(c)any retained benefits,

and the permitted amount is the annual rate of the maximum retirement pension.

(4) In sub-paragraph (2) and (3) “retained benefits” means pensions payable to a dependant as such which, if they had been pensions payable to the participator, would have fallen within paragraph 4.

(5) The maximum retirement pension is the largest retirement pension that could have been paid to the participator under these Regulations if any retained benefits were left out of account for the purposes of paragraphs 7 to 9.

(6) In calculating the maximum retirement pension–

(a)if the participator died in relevant employment and had not attained the age of 60, it is to be assumed that he continued in relevant employment at the same salary up to, and retired on, his 60th birthday, and

(b)if he died in relevant employment and had attained the age of 60, it is to be assumed that he retired on the day before that of his death.

PART IVlump sums on death

11.—(1) The lump sum secured by any death benefit contributions must not be such as to cause the total lump sum death benefits to exceed the permitted amount.

(2) The total lump sum death benefits are the total of–

(a)the lump sum secured by the contributions, and

(b)any similar benefits totalling £1,000 or more that are payable under relevant schemes.

(3) The relevant schemes are–

(a)approved schemes,

(b)schemes approved under Chapter IV of Part XIV of the Taxes Act,

(c)free-standing additional voluntary contributions schemes,

(d)retirement annuity contracts approved under Chapter III of Part XIV of the Taxes Act, and

(e)the scheme constituted by the 1988 Regulations.

(4) The permitted amount is £5,000 or, if greater, 4 times the death benefit contributor’s remuneration.

(5) The death benefit contributor’s remuneration is the greatest of S, T and U, where–

Sis what his final remuneration would have been if the date of his death had been the material date,

Tis his highest year’s adjusted earnings for the purpose of calculating S, and

Uis his total taxable earnings during any period of 12 months ending not more than 3 years before the date of his death, increased as mentioned in paragraph 3(1).