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Pension schemes: regulations

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The Taxation of Pension Schemes (Transitional Provisions) (Amendment) Order, SI 2011/732:

  • provides that where an individual is entitled to either a tax free lump sum from their pension scheme of more than 25% of their fund value or a protected pension age, the scheme administrators have up to six months to arrange for payment of the associated benefits;
  • enables a person who is aged 50 to 54 (inclusive), who has become entitled to a pension and who wishes to change to another pension type or who hadn’t started taking the pension before 6 April 2010, to commence taking it on or after 6 April 2010 without incurring an extra tax charge; and
  • ensures that where the person became entitled to a tax free lump sum before 6 April 2010 but it is not paid until after this date, it can be paid tax free.

The Registered Pension Schemes (Transfer of Sums and Assets) (Amendment) Regulations, SI 2011/733, supplement SI 2011/732 by removing an unintended tax charge where a person, who is aged 50 to 54 (inclusive), and who started drawing a pension before 6 April 2010, changes their pension provider after this date but before they are 55.