RPSM09103108 - Technical Pages: Member benefits: An alternatively secured pension: Member cannot be traced at age 75

Member cannot be traced at age 75

If on a member’s 75th birthday the scheme administrator, after taking reasonable steps, has not been able to ascertain their whereabouts, any funds which were not previously designated into unsecured pension will not automatically be treated as becoming held in an alternatively secured pension fund (see RPSM09103010). Instead the funds will be treated as being held ‘in suspense’ until the member can be traced. However these uncrystallised funds will still be tested against the lifetime allowance at the member’s 75th birthday (see RPSM11102080).

Once the member has been traced they have a period of six months to either:

• elect for the fund to be treated as an alternatively secured pension fund at the expiry of the six month period, or
• purchase a lifetime annuity or
• take up the option of a scheme pension.

If they do not then the fund will be treated as an alternatively secured pension fund on the expiry of the six month period.

Whilst the funds remain ‘in suspense’, any payments made from the fund will be treated as unauthorised payments. And once the member has been traced, the only authorised payment of pension that may commence to be paid within the six month period are a scheme pension or lifetime annuity.

For the avoidance of doubt the member will not have become entitled to receive a pension commencement lump sum in relation to the uncrystallised funds that were tested for lifetime allowance (see RPSM09104130 and RPSM09104140).