PSI13.3.4 - Withdrawal from Service: Deferred Benefits Short Service Benefits - Uniform Accrual

(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 preservation requires an early leaver's SSB to be calculated on a "uniform accrual" basis the N/NS x P limit can be applied. Uniform accrual is very similar to our N/NS x P formula, except that in the preservation formula "N" and "NS" refer to actual and potential pensionable service whereas in the Revenue formula they relate to total service. Uniform accrual applies where the pension at normal pension age:

1. is a fixed amount
2. is a predetermined fraction of final remuneration
3. is based on an uneven scale, such as uplifted 60ths (see PSI6.5.6).
4. does not accrue evenly because of an uneven rate of contributions to a money purchase scheme (see paragraphs 128 and 129 of JOM 78).

The application of the uniform accrual formula prevents us from reducing benefits below the N/NS x P limit where we might otherwise have done so.