24/02/09 Trivial Commutation Changes
24 February 2009
With effect from 6 April 2009, the regulations governing trivial commutation of occupational pensions will be amended to permit small pension “pots” up to £2000 to be commuted.
The requirements are:
1.The member is aged 60 but under 75.
2.The member is neither a controlling director of a sponsoring employer of the scheme or any related scheme, nor connected to such a person.
3.Every other related scheme makes a payment to the member.
4.The total payments made by all related schemes do not exceed £2000.
5.All the payments are made within a one month period.
6.The payments extinguish the member’s entitlement to benefits under all the related schemes.
7.No transfer has been made in respect of the member out of any of the related schemes during the 3 preceding years.
The new triviality requirements are intended to apply in the same cirumstances as are presently permitted – ie including on death and winding-up. Protected Rights and GMPs can be commuted under the new regulations.