PSI20.4.5 - Funding and Surpluses: Insured Schemes - Earmarked Policies - Actuarial Assumptions

(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)

[PN13.10]

The principal actuarial assumptions to be used for calculating contributions to the type of scheme or arrangement described in PSI20.4.3 are as set out in the Pension Scheme Surpluses (Valuation) Regulations (see Section 8 of this Part). These are:

1. a rate of investment return of 8.5% per annum;
2. a rate of general earnings increases to 6.9% per annum;
3. a maximum rate of increases to pensions in payment of 5.3% per annum, and
4. post-retirement mortality based on the PA(90) ultimate table rated down one year.

For this type of scheme or arrangement the permitted maximum (see PSI6.4.8) should be assumed to increase at the rate of 5.3% per annum.