PSI13.3.2 - Withdrawal from Service: Deferred Benefits - Short Service Benefit

(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)

[PN10.4]

Once an early leaver has qualified for preservation he or she is entitled to short service benefit (SSB), and this must represent a fair proportion of his or her prospective benefits at normal pension age (see PSI13.1.5). This fair proportion can often be determined under the scheme rules (see PSI13.3.3) but in other cases the benefit rules may be framed in a way that makes this approach neither practicable nor equitable. SSB must then be calculated on the basis of "uniform accrual" (see PSI13.3.4). The fair proportion requirement can prevent us from imposing normal Revenue limits of N/NS x P or N30ths on the amount of the preserved benefits (see also PSI10.1.14). This latter situation generally arises in relation to money purchase schemes (see PSI13.3.9-12).