In our June 2009 update, we reported that the Registered Pension Schemes (Authorised Payments) Regulations 2009 (the Authorised Payments Regulations) had come into force on 1 June 2009 and that these permitted occupational pension scheme members to take pension pots payable from 1 December 2009, which were valued below £2,000, as a lump sum regardless of benefits held under other arrangements.

The DWP has now published the draft Occupational and Personal Pension Schemes (Authorised Payments) Amendment Regulations 2009. These draft regulations make minor amendments to other regulations to mirror the changes in the Authorised Payments Regulations by allowing:

  • small pension pots that cannot be commuted under the existing rules on trivial commutation, but that fall within Part 2 of the Authorised Payments Regulations, to be treated as authorised lump sums; and
  • certain lump sum payments to be treated as taxed lump sums.

The draft regulations are expected to come into force on 1 December 2009.