Taxes Consolidation Act 1997 Schedule 23B paragraph 1

Calculation of the uncrystallised pension rights of an individual on 1 January 2014

Paragraph 1 of Schedule 23B sets out how an individual's uncrystallised pension rights are to be valued on the specified date (1 January 2014) for the purposes of the Chapter 2C pension fund threshold regime.

• The total value of an individual's uncrystallised pension rights on 1 January 2014 is the aggregate of those rights across all relevant pension arrangements of which the individual is a member, including occupational pension schemes, retirement annuity contracts, PRSAs, AVCs, and buy-out bonds.
• For defined contribution arrangements, the value is simply the aggregate of cash sums and the market value of any other assets held under the arrangement on 1 January 2014 that represent the individual's rights.
• For defined benefit arrangements, the value is calculated using the formula (RVF × AP) + LS, where RVF is the relevant valuation factor of 20, AP is the gross annual pension the individual would be entitled to on 1 January 2014 if the right had crystallised, and LS is any separately accrued lump sum entitlement (not arising from commutation of pension).
• The defined benefit valuation assumes the individual had reached normal retirement age on 1 January 2014 and that the entitlement to benefits had not arisen because of mental or physical incapacity.