PSI6.5.18 - Total Benefits on Retirement at Normal Retirement Age: Maximum Total Benefits - Members Subject to Pre-Finance Act 1989 Basis for Early/Late Retirement

(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)

Where the high accrual rate is not acceptable tell the agents so and give them the reasons why. Tell them that the scheme can give the same level of benefit at NRD by using a benefit rule worded on the following lines:

“Members entitled to pre-17 March 1987 continued rights are entitled to a pension on ceasing to be in service at NRD on the following scale:

1. where the member can complete [x] or more years’ pensionable service by NRD: 2/3rds of final remuneration,
2. Where the member can compete [y] or more years’ pensionable service by NRD but less than [x] years: [z] of final remuneration for each year of pensionable service,
3. where the member can complete less than [y] years’ pensionable service before NRD: [here is inserted the relevant part of the uplifted 60ths table (see PSI6.5.6)]”.

In the case of any other member:

1. where the member can complete [x] or more years’ pensionable service by NRD: 2/3rds of final remuneration,
2. where the member can complete less than [x] years’ pensionable service by NRD: [z] of final remuneration for each year of pensionable service.

Notes

[x] For the number of years service enter 2/3rds of the scale figure: for example, if the scale is 1/30th enter 20.
[y] Enter the figure 7 if the scale accrual rate is between 1/30th and 1/44th or the figure 6 if the scale is between 1/45th and 1/60th.
[z] Enter the scale accrual rate: examples are 1/30th, 1/45th, or 1/54th.