Transfers - frequently asked questions

A: Yes, if it's a 'recognised transfer', it will be an authorised member payment with no adverse tax consequences.

HMRC Pensions Tax Manual - PTM100010: Transfers: essential principles

A: No they don’t.

Cheryl does not have the right to remain a member of her ex-husbands scheme; her only option is to move the money to a new arrangement. Because of this it is not treated as a transfer and her adviser doesn’t have to be a PTS.

A: It depends

Uncrystallised benefits

Not all benefits need to be transferred at once; they can be transferred in stages. Benefits are not usually tested against the lifetime allowance at date of transfer, except where the transfer is to an overseas scheme (QROPS).

Crystallised benefits

If the benefits have been designated to drawdown the whole of the drawdown pension fund or flexi-access drawdown fund under an arrangement must be transferred - a partial transfer is not possible.

HMRC Pensions Tax Manual - PTM100010: Partial transfers

HMRC Pensions Tax Manual - PTM101999: Transfers to a QROPS

A: If the individual had enhanced or primary protection the benefits could be transferred to another registered pension scheme after A-Day and they would keep the higher tax-free cash entitlement.

However, the same would not apply to somebody with a tax-free cash entitlement of more than 25% who had not applied for primary or enhanced protection. These people will lose their entitlement to the higher amount of tax-free cash under the new plan, unless they transfer as part of a 'block transfer' or in certain circumstances on the wind-up of an occupational scheme.

Tax-free cash protection on transfer

HMRC Pensions Tax Manual - PTM063150: scheme-specific lump sum protection - transfers and winding-up

A: No, HMRC rules don’t allow this. To take advantage of better annuity rates available from another provider, an open market option payment can only buy an annuity.

As John has an entitlement to more than 25% tax-free cash but no access to drawdown from his current pension scheme, the only way he can access drawdown is to transfer, before taking benefits, to a pension scheme that provides it.

For the higher tax-free cash entitlement to survive the transfer, the transfer will have to be a block transfer or a wind-up transfer.

HMRC Pensions Tax Manual - PTM062400: Open market option

HMRC Pensions Tax Manual - PTM063210: Entitlement to pension

A: There is nothing to stop Nigel transferring his registered pension benefits between UK pension providers.  However, not all providers allow people resident overseas to start a new pension arrangement.


The information provided is based on our current understanding of the relevant legislation and regulations and may be subject to alteration as a result of changes in legislation or practice. Also it may not reflect the options available under a specific product which may not be as wide as legislations and regulations allow.

All references to taxation are based on our understanding of current taxation law and practice and may be affected by future changes in legislation and the individual circumstances of the investor.

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The Royal London Mutual Insurance Society Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. The firm is on the Financial Services Register, registration number 117672. It provides life assurance and pensions. Registered in England and Wales number 99064. Registered office: 55 Gracechurch Street, London, EC3V 0RL.