The cash equivalent transfer value (CETV) is the cash value placed on a member’s pension benefits. Later this year, the UK Government are expected to introduce regulations that will significantly change the law relating to CETVs. The purpose of the new regulations is to provide additional safeguards against pension scams for members. However, the regulations place the responsibility for completing this analysis on behalf of an outgoing member on the trustees of the transferring scheme.

Excluded schemes

Certain schemes will be excluded from the new regulations. This means that a proposed CETV to these schemes will not require any analysis by the transferring trustees or their scheme administrators.

The schemes excluded include:

  • Those set up under the Public Service Pensions Act 2013,

  • Personal pension schemes that have been authorised by the Prudential Regulatory Authority and,

  • Personal pension schemes that have been authorised by the Financial Conduct Authority.

Also excluded are collective money purchase schemes which are established under the Pension Schemes Act 2021.

All other schemes

For all other UK occupational pension scheme, the regulations will require the member to produce certain evidence that confirms an employment link to the transferee scheme. The requirements include payslips showing that the member has been paid by the transferee scheme’s sponsoring employer and a schedule showing that contributions have been made by both the member and the…

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