PSI8.1.44 - Lump Sum Benefits and Commutation: Maximum Lump Sum Benefits – Pension Sharing on Divorce – General

(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)

The Revenue limits on lump sum benefits described in

• PSI8.1.21 – basic 3N/80ths accrual
• PSI8.1.22 – uplifted accrual for pre Finance (No 2) Act 1987 members
• PSI8.1.24 – uplifted accrual for Finance (No 2) Act 1987 regime members
• PSI8.1.25 – uplifted accrual for Finance Act 1989 regime members
• PSI8.1.37 – members with a low normal retirement age

do not apply for employees whose benefits are permanently reduced by a pension sharing on divorce order (see PSI3.5.4) and the pension debit must be taken into account for Revenue limits purposes (see PSI6.5.89).

For employees whose benefits are permanently reduced by a pension sharing on divorce order but who are moderate earners (see PSI6.5.90 and PSI6.5.92), the limits set out in PSI8.1.21, PSI8.1.22, PSI8.1.24, PSI8.1.25, and PSI8.1.37 apply as normal.

Different limitation requirements apply in relation to simplified defined contribution schemes (see PSI8.1.46).