RPSM10105520 - Technical Pages: Death benefits: Lump sums: Member dies before or after age 75: Winding-up a scheme simply to facilitate payment of lump sum

Winding-up a scheme simply to facilitate payment of a winding-up lump sum death benefit

Where the winding-up of a registered pension scheme has begun, and HMRC consider that the scheme is being wound-up wholly or mainly for the purpose of facilitating payment of one or more

• winding-up lump sum(s) or
• winding-up lump sum death benefit(s),

the scheme administrator will become liable to a penalty of up to £3,000 in respect of each member or recipient paid such a lump sum by the scheme.