RPSM09104980 - Technical Pages: Member benefits: Lump sums: Trivial commutation lump sum: Relevant crystallised pension rights

If the lump sum was paid on or after 6 April 2011 you should first read RPSM09105085.

Valuing pension rights for trivial commutation purposes: relevant crystallised pension rights

For trivial commutation purposes benefits that have previously been drawn or crystallised by the individual (or have been deemed to crystallise for lifetime allowance purposes) under any registered pension scheme (or previously tax approved pension scheme), whether before, on or after 6 April 2006, must be valued.

The value is that which has been attributed to those benefit entitlements for lifetime allowance purposes. This is the amount that crystallised at any BCE that has occurred on or after 6 April 2006, or the crystallised amount that is attributed to any pension in payment on 5 April 2006 under the lifetime allowance rules. Those values are then indexed up to reflect the change in the standard lifetime allowance from those points of valuation.

A member’s relevant crystallised pension rights are made up of two elements

• a measure of the amounts that have crystallised previously for lifetime allowance purposes in respect of the individual (so at all the BCEs that have occurred on or since 6 April 2006), and
• the crystallised value, as measured for lifetime allowance purposes, of any pensions in payment to that individual on 5 April 2006 (relevant existing pensions).

How the two elements of an individual’s relevant crystallised pension rights are valued is explained on RPSM09104990 to RPSM09105020.