(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)
[PN10.42(B)]
Where the pension to be commuted on the grounds described in
PSI17.2.16is under a “bought
out” policy (see PSIPart 13 Section 4
PSI13.4.1) there will be no
administrator on whom any section 599 tax can be charged. Full
commutation can therefore be permitted only if satisfactory
arrangements have been made with the Life Office concerned for
payment of any tax due out of the policy proceeds. The appropriate
arrangements are dealt with by Compliance Audit Section under
reference SF70/194.
