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HMRC internal manual

Employment Income Manual

Employer-financed retirement benefits schemes: payments other than on retirement or death

Section 393B ITEPA 2003

As EIM15021 indicates, payments and benefits other than those made on retirement or death can be ‘relevant benefits’. They comprise payments and benefits made:

  • in anticipation of retirement. This prevents, for example, avoidance of tax by making a lump sum available before the retirement date. There is no age limit to apply and whether a payment is made in anticipation of retirement is a question of fact. If a payment is clearly linked to retirement or is in substitution for a payment that would have been made on or after retirement then it will be ‘in anticipation of retirement’
  • after retirement or death in connection with past service. This means, for example, that payments to retired former employees are relevant benefits
  • in connection with any change in the employee’s service. Such payments are normally chargeable under Section 62 ITEPA 2003 in any event (see EIM00680).
  • by virtue of a pension sharing order.