(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 a scheme offers annuity purchase deferral/income drawdown,
it is for the scheme member or survivor (i.e. widow, widower or
dependant) to decide whether or not he or she wishes to take
advantage of it.
When benefits first become due and payable under the rules of
the scheme the member / dependant may with the consent of the
trustees elect:
a) to receive a pension in the form of income drawdown in
respect of the total pension benefits, or
b) to secure the whole pension by immediate annuity purchase,
or
c) to take a combination of both, i.e. to secure part of the
pension by immediate annuity purchase and to apply income drawdown
to the remainder (see
PSI25.2.11 regarding the phasing of
annuities)
Where the individual is a member of more than one scheme of the employer or has more than one buy–out contract, income drawdown can be taken from some of the schemes/contracts and annuities can be purchased in respect of the others. Normal rules apply as to the timing of benefits from different schemes (see PSI10.1.25 and for buy–out contracts PSI13.4.9(a)).
