PSI6.1.24 - Total Benefits on Retirement at Normal Retirement Age: General - Forfeiture of benefits

(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)

[PN 7.21(a)]

Some scheme rules provide that the member will lose all entitlement to benefits if he/she attempts to assign them. This provision is sometimes extended to cover the pensions of persons who become bankrupt. The trustees are often given discretion to apply such forfeited pensions for the benefit of the pensioner, or his/her dependants. This is quite acceptable, but a power to apply the forfeited benefits to relatives or other people who are not dependants should not be accepted. The ban on assignment does not extend to bequests under wills of any money in which the member has an interest, for example, the balance of any pension guarantee (see Part 12).

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