PTM146400 - Other authorised payments: genuine errors: payments that are known to be unauthorised when made
Payments that are known to be unauthorised when made
A genuine error that occurred as part of the administration of a registered pension scheme might mean that it is known that, if it is paid, a payment that is due to be made will be an unauthorised payment. The circumstances might be such that, had it not been for the genuine error, the payment would have been an authorised payment. Despite the genuine error that occurred, if the payment is made, it would be an unauthorised payment.
A pension commencement lump sum must be paid within an 18 month period starting 6 months before and ending 12 months after the member becomes entitled to the lump sum and linked pension - see PTM063210. However, due to an error within the administration department of the pension scheme, the lump sum payment is not made by that deadline. If the lump sum is paid after the deadline it will not be a pension commencement lump sum and (unless it falls within the definition of one of the other authorised lump sums) will be an unauthorised member payment.