PSI24.2.4 - Pension Credit Benefits –
Limits on Benefits payable to ex-spouse – Lump sums
(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)
[PN6A.8]
The lump sum payable to an ex-spouse member from pension
credit rights must not exceed an amount equal to
- 2.25 times the initial annual rate of
pension before commutation to be paid to the ex- spouse member from
the pension credit benefit, or
- 3 times the initial annual rate of pension
to be paid to the ex-spouse member form the pension credit rights -
where the pension credit arises under a scheme whose rules provide
for a pension and a separate lump sum rather than a commutable
pension, or
- 25% of the fund underpinning the ex spouse
member’s pension credit rights at the time of payment - where
the pension credit rights arise under a simplified defined
contribution scheme.
It might not always be possible to pay a lump sum from pension
credit rights to an ex-spouse member (see
PSI24.1.4).
