Countdown to the Change in Statutory Minimum Retirement Age (March 2010)

From 6 April 2010 the minimum retirement age will increase overnight from 50 to 55 years of age. The Government announced the change in 2003 and delivered the relevant tax rules within the Finance Act 2004. Pension schemes were given freedom over the period to 5 April 2010 to modify their provisions in readiness for the change.

Current rules allow members of all registered pension schemes, whether individual or group personal pensions (including stakeholder) or occupational schemes, to start taking their benefits from the �Normal Minimum Pension Age� which is:

age 50 up to 5 April 2010
age 55 from 6 April 2010

Inevitably, perhaps, there are some exceptions to the application of the above. These fall broadly into two camps:

where a pension scheme member has a lower �protected� pension age
where ill-health is the reason for early retirement

The term �protected� pension age is used to describe a situation where, as at 5 April 2006, an individual had a right to take pension benefits from:

an occupational pension scheme before the age of 55, under a scheme rule in force on 10 December 2003. The right must be totally unqualified and applying to the individual on both 10 December 2003 and 5 April 2006
a personal pension scheme or retirement annuity contract before the age of 50 and the individual was in a certain occupation prescribed under the law (primarily related to sports persons or those in hazardous occupations)

If you are planning to draw retirement benefits before 6 April 2010 and, whilst at least 50, will not be age 55 at that time, you should take immediate action to explore your options as they may change substantially on 6 April.

Contact your usual Cartlidge Morland adviser to find out more.

Margaret Kain
Pensions Technical Unit
Email: employeebenefits@cartlidgemorland.co.uk
Call: 020 7709 5560

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