(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 a pension sharing on divorce order is applied to a
member’s pension that is in payment the amount of
post-retirement increases that can be applied to the member’s
pension after the sharing order will depend on whether or not the
administrative easement described in
PSI6.5.90 can be applied. If,
at the time of the divorce, the member is not, or was not within
the last 10 years, a controlling director of a participating
employer the easement can still apply only if the member received
earnings, from the employment to which the shared pension relates,
in the year of assessment immediately before the year of assessment
in which the marriage was dissolved or annulled, and those
earnings, from which tax was deducted under PAYE, did not exceed
¼ of the permitted maximum (see Introduction 4.15b) for the
year of assessment in which the marriage was dissolved or
annulled.
If no earnings were received in the year of assessment immediately before the year of assessment in which the marriage was dissolved or annulled because, for example, the member had retired a number of years before the pension sharing order the administrative easement cannot be applied.
