Section 779A Transactions deemed to be pensions in payment

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Amendments

Section 779A inserted by Finance Act 2006 section 14(1)(a)(iv) from 1 January 2006.

(1) Where the assets of a retirement benefits scheme, which is approved, or is being considered for approval, under this Chapter (in this section referred to as the "scheme"), are used in connection with any transaction which would, if the assets were the assets of an approved retirement fund, be regarded under section 784A as giving rise to a distribution for the purposes of that section, the use of the assets shall be regarded as a pension paid under the scheme and the amount so regarded shall be calculated in accordance with that section.

What rules apply to the use of scheme assets?

(1) This rule applies where use of assets held in a retirement benefits scheme would, if such assets were held by an ARF, be treated as distributed by the ARF. In such a case, the use of the assets is treated as payment of a pension (and accordingly,...

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(2) An amount which has been regarded as a pension paid under the scheme, in accordance with this section, shall not be regarded as an asset in the scheme for any purpose.

When an amount is deemed to be a pension payment, is it still a scheme asset?

(2) Where use of assets held in a retirement benefits scheme is treated as payment of a pension, the assets in question must no longer be treated as assets of the scheme.

(3) Any property, the acquisition or sale of which is regarded as giving rise to a pension payment under the scheme, shall not be regarded as an asset of the scheme.

Where the purchase or sale of property gives rise to a deemed pension payment, is the property still treated as a scheme asset?

(3) If the purchase or sale of property gives rise to a pension payment, the property in question is no longer treated as an asset of the scheme.