RPSM03101091 - Technical Pages: Protecting pension rights from tax charges: Valuing pension rights at 5 April 2006:

Retirement annuity contracts that are defined benefits arrangements

In the mid 1970s some retirement annuity contracts were sold where in return for a stream of premiums (contributions to the contract) paid on specified dates the Provider would pay an annuity for life of a specified amount from an agreed date or an annuity for life plus a specified lump sum from an agreed date. The contract would also contain provisions for the payment of a reduced annuity where premiums were not paid as required. Such a contract is providing defined benefits and so is a defined benefits arrangement.

Any uncrystallised rights in such a retirement annuity contract should be valued as defined benefits in accordance with RPSM03101090.

HMRC is not aware of any such contracts providing defined benefits being used under a personal pension scheme.