Defined Benefit pension scheme (also known as a final salary pension scheme) means a scheme where pension is calculated by reference to salary and length of pensionable service.
Defined Contribution pension scheme means a scheme where the benefits are dependent entirely on the amount of contributions paid into the scheme and the investment return achieved on them.
Drawdown means the regular withdrawal of money from a member’s Trinity fund in order to provide the member with a pension in retirement. The funds paid out in drawdown will typically include a return of both capital and interest
Gilt means a UK Government fixed-interest security
HMRC
HMRC is short for Her Majesty’s Revenue and Customs. It is a non-ministerial department of the British Government responsible for the collection of taxes and the payment of some forms of state support.
IHT
Inheritance tax is the tax that is paid on your estate when you die
Insurance and Pensions Authority is a statutory board of the Isle of Man Government, originally established under the Insurance Act 1986 and continued under the Insurance Act 2008, with responsibility for the regulation of the insurance and pensions sector in the Isle of Man.
Lifetime Allowance is an overall ceiling set under UK legislation to limit the amount of an individual’s UK pension fund. The lifetime allowance is fixed at £1,800,000 until April 2012 when it reduces to £1,500,000. When you initially transfer UK pensions into Trinity, their value is tested against the lifetime allowance and, if it exceeds the lifetime allowance, a UK tax charge will arise unless you have registered your UK scheme for protection. This is a one-off test, however. There are clear advantages therefore in transferring a UK pension before it grows in excess of the lifetime allowance.
Personal Pension scheme means a UK pension approved under s631 Income and Corporation Taxes Act 1988.
Protected Rights is a term given to UK contracted-out rights which arise when a person opts out of the State Second Pension. In return, that person receives a contracted-out rebate which is paid into a scheme approved to receive such rights.Where an individual is contracted-out through an Appropriate Personal Pension, these contracted-out rights are known as protected rights and are subject to certain rules.
QROPS
QROPS is short for Qualifying Recognized Overseas Pension Scheme. QROPS is a pension scheme set up outside the UK, which recognized by the UK HM Revenue & Customs as meeting certain standards and conditions.
Recognised Transfer means the transfer of a UK pension to another UK-approved pension scheme or to a QROPS. A recognised transfer is an authorised member payment and so does not incur a tax charge. (Note, see separate reference to Lifetime Allowance.)
Scheme in this brochure refers to the Trinity Pension Scheme
SIPP or Self-Invested Pension Plan is a form of personal pension arrangement with the widest possible investment choice
