256. Preferential liabilities on winding up.

The following provisions1 apply where an occupational pension scheme2 to which these provisions apply is being wound up to determine the order in which the assets3 of the scheme are to be applied towards satisfying the liabilities4 of the scheme in respect of pensions and other benefits5. They apply to an occupational pension scheme other than a scheme which is: (1) a money purchase scheme6; or (2) a prescribed7 scheme or a scheme of a prescribed description8.

The assets of the scheme must be applied first towards satisfying the amounts of the liabilities mentioned below9 and, if the assets are