(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)
Incapacity is not the same as “exceptional
circumstances of serious ill health” for commutation purposes
(see
PSI8.3.15-23). But, this
condition would clearly qualify the member for retirement on
incapacity grounds. Nor does incapacity require the member to be
unemployable. We do not object if a person takes up a new
employment after retiring for this reason. If the employee took up
similar work at a similar rate of pay this would, however, cast
doubt on the retirement. If you come across such a case let the
Divisional Manager see it before questioning the validity of the
retirement. (See also
PSI10.2.13-15 about the benefits
payable if the employee resumes work).
