RPSM03301005 - Scheme Administrator Pages: Protecting pension rights from tax charges: Valuing pension rights: What are crystallised rights

What benefits should be valued as crystallised rights?

Only benefits that are ‘relevant existing pensions’ should be valued as crystallised rights.

Relevant existing pensions are any of the following.

1. A pension (including pensions in drawdown) paid from a scheme approved under Chapter 1 Part 14 ICTA 1988 (an approved occupational pension scheme)
   
   
2. A pension paid from a scheme formerly approved under section 208 ICTA 1970 (an old code scheme)
   
   
3. A pension paid from a relevant statutory scheme (defined in section 611A ICTA 1988) or a scheme treated by HMRC as if it were a relevant statutory scheme.
   
   
4. An annuity (or drawdown pension) paid from any contract relating to (a) to (c) above – this includes contracts that are in the name of the member
   
   
5. A pension paid from the Parliamentary pension scheme or funds
   
   
6. An annuity paid from a retirement annuity contract
   
   
7. An annuity paid from a scheme approved under Chapter 4 part 14 ICTA 1988 (approved personal pension schemes), and
   
   
8. Income withdrawals under an approved personal pension scheme

A pension paid to an individual due to the death of another person (a dependant’s pension) is not a relevant existing pension and should not be included in the valuation of pension rights.

Where an individual received a lump sum before 6 April 2006 but deferred entitlement to payment of the pension until after 5 April 2006 the deferred pension is an uncrystallised right and should be valued as such.