scheme pension

37(1) (as defined in paragraph 2 of Schedule 28 to the Finance Act 2004) in relation to a member of a pension scheme, in the case of a pension scheme with fewer than 50 members, a pension payable to the member if:
1. (a) it is payable by an insurance company selected by the scheme administrator or, where the scheme administrator is an insurance company, by the scheme administrator; and
1. (b) it satisfies the condition in (3);

(2) in the case of a pension scheme with 50 or more members, a pension payable to the member if:
1. (a) it is payable by the scheme administrator or by an insurance company selected by the scheme administrator; and
1. (b) it satisfies the condition in (3);

(3) the condition is that (subject to (4)):
1. (a) the pension is payable (at least annually) until the member's death or until the later of the member's death and the end of a term certain not exceeding ten years; and
1. (b) the rate of pension payable in respect of any relevant 12 month period is not less than the rate payable in respect of the previous 12 month period;

(4) none of the following prevent the pension satisfying the condition in (3):
1. (a) if the ill-health condition (as defined in paragraph 1 of that Schedule) is met when the member becomes entitled to the pension, the pension not being payable for a period during which the individual's physical and mental condition is no longer such as would, under the terms of the scheme, give rise to entitlement to the pension; or
1. (b) a reduction in the rate of the pension which applies to all the scheme pensions being paid to or in respect of members of the pension scheme; or
1. (c) if the member becomes entitled to state retirement pension, a reduction in the rate of the pension which does not exceed the rate at which state retirement pension is payable (or, if the rate at which state retirement pension is payable is greater than the rate of the pension, the pension ceasing to be payable);

(5) for the purposes of (4)(c) the following constitute "state retirement pension":
1. (a) retirement pension under the Social Security Contributions and Benefits Act 1992 or the Social Security Contributions and Benefits (Northern Ireland) Act 1992; and
1. (b) graduated retirement benefit under the National Insurance Act 1965 or the National Insurance Act (Northern Ireland) 1966;

(6) a pension is payable until the end of a term certain even if it may, after the death of the member during the term, end on the pensioner:
1. (a) marrying; or
1. (b) reaching the age of 18; or
1. (c) ceasing to be in full-time education;

(7) a relevant 12 month period is any 12 month period which:
1. (a) begins on or after the first anniversary of the day on which the member becomes entitled to the pension; and
1. (b) ends before the day on which the pension ceases to be payable.

More Resources: