PSI6.1.14 - Total Benefits on Retirement at Normal Retirement Age: General - Payment of pensions - Date of Commencement

(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)

Payment of an employee’s pension cannot normally begin before NRD if the employee is still in service. (See Part 10 where an employee retires before NRD and Part 9 where retirement is deferred until after that date). The only exceptions concern

• the employee’s GMP and/or Protected Rights, which may be paid from such date as is specified in the relevant Social Security legislation if that is earlier than the scheme NRD,
• AVC benefits may (subject to scheme rules) be paid earlier or later than employer funded benefits regardless of whether the member retires or leaves pensionable service (see PSI25.3.1).

The balance of the pension must be deferred until NRD or earlier retirement. Pensions for members who are subject to both the Finance Act 1989 requirements and the “new” simplified discretionary regime for early/late retirement (which was introduced on the back of the Finance Act 1989 changes) can come into payment on retirement at any time between age 50 and 75.