PSI1.3.20 - Establishment and Administration of Retirement Benefits Schemes: Exempt Approved Schemes and Conformity with Trust Law - Rule Against Perpetuities
(This archived guidance relates to HMRC discretionary
practice before the 6th April 2006. For current guidance on
Registered Pension Schemes see the Registered Pension Schemes
Manual)
(This text has been withheld because of exemptions in the
Freedom of Information Act 2000)
The rule against perpetuities prevented a trust established
under English law from going on forever and its effect is to
invalidate any trust if its termination can be postponed beyond a
prescribed period. However, an occupational pension scheme does not
now need a perpetuity clause if it falls into one of the following
categories:
- public service pension schemes,
- schemes which are contracted-out of SERPS,
- schemes which are defined in The Occupational Pension Schemes (Perpetuities) Regulations 1973, as amended. These Regulations cover all schemes approved under Chapter 1 Part XIV ICTA 88.
You should not therefore question the omission of a perpetuity provision from any scheme submitted for approval, nor object if it is proposed to remove the perpetuity provision from an existing scheme.
