The Pension Schemes (Transfers, Reorganisations and Winding Up) (Transitional Provisions) Order 2006
2006 No. 573
INCOME TAX
The Pension Schemes (Transfers, Reorganisations and Winding Up) (Transitional Provisions) Order 2006
Made 9th March 2006
Laid before the House of Commons 10th March 2006
Coming into force 6th April 2006
The Treasury, in exercise of the powers conferred by section 283(2) of the Finance Act 20041, make the following Order:
General
Citation, commencement and interpretation
1.—(1) This Order may be cited as the Pension Schemes (Transfers, Reorganisations and Winding Up) (Transitional Provisions) Order 2006, and shall come into force on 6th April 2006.
(2) In this Order, references to provisions of Schedule 36 are references to provisions of Schedule 36 to the Finance Act 2004.
(3) In this Order—
“normal minimum pension age” has the meaning given in section 279(1) of the Finance Act 2004, and
“the TUPE Regulations” means the Transfer of Undertakings (Protection of Employment) Regulations 19812.
The original pension scheme condition
2.—(1) For the purposes of this Order the original pension scheme condition is met if conditions A and B are met.
(2) Condition A is that on 10th December 2003 a pension scheme (“the original pension scheme”) was either an approved scheme for the purposes of Chapter 1 of Part 14 of the Income and Corporation Taxes Act 19883(see section 612(1) of that Act) or was a relevant statutory scheme for the purposes of that Chapter (see section 611A of that Act4).
(3) Condition B is that the original pension scheme was a scheme whose rules included provision conferring a right to retire before the normal minimum pension age on some or all of the persons who were then members of the scheme.
The employee condition
3.—(1) For the purposes of this Order the employee condition is met if either condition A or condition B is met.
(2) Condition A is that, on 10th December 2003, a person (“the employee”) was a person who had the right, under the original pension scheme, to retire before the normal minimum pension age.
(3) Condition B is that the employee would have been a person who, on 10th December 2003, had the right, under the original pension scheme, to retire before the normal minimum pension age had the employee been a member of the scheme on that date.
Transfers during period beginning with 10th December 2003 and ending with 5th April 2006
Conditions for application of article 8
4. Article 8 applies if the following conditions are met—
(a) the original pension scheme condition (see article 2);
(b) the employee condition (see article 3);
(c) the transfer condition, either as it applies in the case of one transfer (see article 5), or as it applies in the case of two or more transfers (see article 6); and
(d) the new pension scheme condition (see article 7).
The transfer condition as it applies in the case of one transfer
5.—(1) The transfer condition, as it applies in the case of one transfer, is met if conditions A to G are met.
(2) Condition A is that, during the period beginning with 10th December 2003 and ending with 5th April 2006, there was one transfer of an undertaking, or part of an undertaking.
(3) Condition B is that the TUPE Regulations applied to the transfer.
(4) Condition C is that by virtue of the transfer, the employee ceased to be employed by the transferor and became employed by the transferee.
(5) Condition D is that the transferor was the employer in relation to the original pension scheme.
(6) Condition E is that at the time immediately before the employee became employed by the transferee, the employee was a member of the original pension scheme.
(7) Condition F is that from the time when the employee became employed by the transferee, the employee—
(a)
(a) was a member of a pension scheme in relation to which the transferee was the employer, or
(b)
(b) was a member of one other pension scheme (“the new pension scheme”) in relation to which the transferee was the employer.
(8) Condition G is that, as a result of the transfer, all the sums held for the purposes of, or representing the employee’s accrued rights under, the original pension scheme have become held for the purposes of, or represented rights under, the new pension scheme.
(9) In paragraph (2) the reference to an undertaking or part of an undertaking has the same meaning as in the TUPE Regulations.
The transfer condition as it applies in the case of two or more transfers
6.—(1) The transfer condition, as it applies in the case of two or more transfers, is met if conditions A to H are met.
(2) Condition A is that, during the period beginning with 10th December 2003 and ending with 5th April 2006, there were two or more transfers of an undertaking, or part of an undertaking.
(3) Condition B is that the TUPE Regulations applied to each transfer.
(4) Condition C is that by virtue of each transfer, the employee ceased to be employed by the transferor and became employed by the transferee.
(5) Condition D is that the transferor—
(a)
(a) in the case of the first transfer, was the employer in relation to the original pension scheme, and
(b)
(b) in the case of each subsequent transfer, was the employer in relation to the pension scheme of which the employee was a member immediately before the transfer.
(6) Condition E is that the employee—
(a)
(a) in the case of the first transfer, was a member of the original pension scheme at the time immediately before the employee became employed by the transferee, and
(b)
(b) in the case of each subsequent transfer, was a member of a pension scheme in relation to which the transferor was the employer at the time immediately before the employee became employed by the transferee.
(7) Condition F is that in the case of a transfer other than the final transfer, and from the time when he became employed by the transferee, the employee was a member of a pension scheme in relation to which the transferee was the employer.
(8) Condition G is that in the case of the final transfer, and from the time when he became employed by the transferee, the employee—
(a)
(a) was a member of a pension scheme in relation to which the transferee was the employer, or
(b)
(b) was a member of one other pension scheme (“the new pension scheme”) in relation to which the transferee was the employer.
(9) Condition H is that, as a result of the transfers, all the sums held for the purposes of, or representing the employee’s accrued rights under, the original pension scheme have become held for the purposes of, or represented rights under, the new pension scheme.
(10) In paragraph (2) the reference to an undertaking or part of an undertaking has the same meaning as in the TUPE Regulations.
The new pension scheme condition
7.—(1) The new pension scheme condition is met if conditions A and B are met.
(2) Condition A is that the new pension scheme was a scheme whose rules, at the time of the transfer (where article 5 applies), or at the time of the final transfer (where article 6 applies), included provision conferring a right on some or all of the persons who were then members of that scheme to retire before the normal minimum pension age.
(3) Condition B is that, on 6th April 2006, the new pension scheme was within any of paragraphs (a) to (e) of paragraph 1(1) of Schedule 36 (deemed registration of existing schemes) (and, accordingly, is treated as having become a registered pension scheme).
Rights to take benefit before normal minimum pension age
8.—(1) For the purposes of paragraph 22 of Schedule 365(rights to take benefit before normal minimum pension age), and in relation to the employee, the new pension scheme is a protected pension scheme.
(2) The employee has the right to retire at the age specified in paragraph (3) or (4), whichever is the greater.
(3) The age specified in this paragraph is the age at which—
(a)
(a) immediately before the transfer, the employee had the right to retire under the original pension scheme (in a case where article 5 applies), or
(b)
(b) immediately before the final transfer, the employee had the right to retire under the original pension scheme (in a case where article 6 applies).
(4) The age specified in this paragraph is...
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