Citation, commencement and effect

1. This Order may be cited as the Taxation of Pension Schemes (Transitional Provisions) (Amendment) Order 2006, shall come into force on 11th August 2006 and have effect in respect of—

(a) death benefit lump sum payments made, and

(b) benefit crystallisation events taking place,

on or after 6 ^th April 2006.

Amendment of the Taxation of Pension Schemes (Transitional Provisions) Order 2006

2. —(1)The Taxation of Pension Schemes (Transitional Provisions) Order 2006( 2 ) is amended as follows.

3. After article 29 insert—

“ Member’s unsecured pension funds – further provisions

29A. —(1) In the case of an individual who meets the conditions set out in paragraph (2), paragraph (3) applies.

(2) The conditions are as follows.

• Condition A

  The individual is a member of a scheme which falls within paragraph 1(1) of Schedule 36.

• Condition B

  The individual was, on 5 ^th April 2006, entitled to a pension which was not provided under a defined benefits arrangement and which—

  (a)

  took the form of income drawdown under a retirement benefits scheme approved for the purposes of Chapter 1 of Part 14 of ICTA ; or

  (b)

  was paid from the resources of—

  (i)

  a small self-administered scheme as defined in the Retirement Benefits Schemes (Restriction on Discretion to Approve) (Small Self-Administered Schemes) Regulations 1991 ( 3 ) , or

  (ii)

  a small self-administered scheme that had been approved under section 590 of ICTA,

  the rules of which, on 5 ^th April 2006, did not require the purchase of an annuity in respect of the individual; or

  (c)

  took the form of income withdrawal under a personal pension scheme approved under Chapter 4 of Part 14 of ICTA pursuant to section 634A ( 4 ) of that Act.

(3) In section 216 (benefit crystallisation events and amounts crystallised) in benefit crystallisation event 5A ( 5 ) , in column 1 of the table, after the words “available for the payment of unsecured pension to the individual” add—

• “ except to the extent that, the sums and assets in the money purchase arrangement are sums or assets deemed to represent an arrangement pursuant to paragraph 8(1A) (a) to (c) of Schedule 28 as modified by article 29 of the Taxation of Pension Schemes (Transitional Provisions) Order 2006 ( 6 ) ” . ” .

4. In article 40(1)—

(a) in sub-paragraph (b), for “the member’s death” substitute—

“ the date upon which the administrator of the pension scheme could reasonably have known of the member’s death ” ; and

(b) in sub-paragraph (e), for the words from “given” to the end of the sub-paragraph, substitute “led to the Commissioners withdrawing the approval of the scheme.”.

5. In article 41(1)—

(a) in sub-paragraph (c), for “the dependant’s death” substitute—

“ the date upon which the administrator of the pension scheme could reasonably have known of the dependant’s death ” ; and

(b) in sub-paragraph (e), for the words from “given” to the end of the sub-paragraph, substitute “led to the Commissioners withdrawing the approval of the scheme.”.