To qualify for scheme specific lump sum protection an individual
must have under a
registered pension scheme uncrystallised lump sum
rights of more than 25% of the value of their total uncrystallised
rights under the scheme. (But this form of protection does not
apply where an individual has total lump sum rights of more than
£375,000 and they have either primary or enhanced protection.)
So to see if an individual qualifies both the value of the
uncrystallised lump sum rights and the value of the uncrystallised
pension rights under the scheme needs to be found.
RPSM03302030 to
RPSM03302120 explain how to value
uncrystallised lump sum rights.
RPSM03301030 to
RPSM03301100 explain how to value
uncrystallised rights.
Where (VULSR/VUR) x 100 is more than 25 scheme specific lump
sum protection may apply.
(VULSR is the value of the uncrystallised lump sum rights and
VUR is the value of the uncrystallised pension rights for the
member under the scheme.)
However where there are uncrystallised rights under more than
one scheme for the same pensionable employment and either
a further calculation must be carried out to find the value of
VULSR or VUR (as appropriate). This calculation will reduce the
amount of the entitlement by a proportion of the amount the total
entitlement is above the maximum permitted lump sum/pension.
RPSM03302140 explains this in more
detail.
Detailed technical guidance on the valuation of lump sums for
scheme specific lump sum protection can be found at
RPSM03105529 to
RPSM03105570.
| Glossary ( RPSM20000000) |
