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Annuity definition

Published by a LexisNexis Pensions expert

What does Annuity mean?

A series of regular payments, usually payable for the life of the annuitant.

An annuity is usually purchased by a lump sum of cash. Pension schemes sometimes discharge their promise of pension benefit by purchasing an annuity.

Minimise

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Contents of Wills—annuities

An annuity is a sum of money payable periodically, out of personal estate. Savery v Dyer (1752) Amb 139 (not reported by LexisNexis®). It is personalty Parsons v Parsons. An annuity is a legacy and a bequest of such a capital sum as may be necessary to produce the amount of the annuity.Annuities are sometimes useful if a drip-feed approach is required. They are essentially, legacies payable by instalments for the lifetime of a beneficiary.The Will should provide if:•the executors have the power to purchase the annuity from the estate's capital assets•the executors set aside a sum from income to fund the purchase of the annuity•the executors set aside a sum from both capital and income to fund the purchase of the annuity•the annuity is purchased during the executors' lifetimes, if they have the funds to do so, the deferred annuity being vested in trustees on deathDepending on the method chosen, there will be differing tax considerations, both capital and income.Annuities may be created:•inter vivos by deed•by Will•by or under statutory powersClassification of annuities by WillAn annuity given by Will is a legacy of money payable by instalments, each of which is a separate legacy or a series of legacies payable at intervals.An annuity given by Will may be classified as:•a specific annuity (a gift

Transfers and personal pensions

Transfers and personal pensions style="width: 100%"> STOP PRESS: Concerns had been raised about the application of the Occupational and Personal Pension Schemes (Conditions for Transfers) Regulations 2021, SI 2021/1237 to transfers which involve overseas investments or small-scale incentives. For instance, PensionBee has stated that the regulations ‘appear to have been misused in a variety of inventive ways’, resulting in members being prevented from transferring to their provider of choice. To address this, on 5 July 2022 the Department for Work and Pensions (DWP) and the Pensions Regulator (TPR) have issued a joint statement stating that:• the DWP and TPR continue to review how the regulations work in practice and trustees/scheme administrators are encouraged to share any relevant feedback • by way of reminder, the regulations are not intended to impose additional burdens on schemes or administrators, or to impact on standard business practices. Likewise, they are not designed to offer protection against normal market volatility • TPR has amended its guidance on dealing with transfer requests to clarify, among other things, that not all incentives or overseas investments create a heightened transfer risk • the DWP has committed to a review of the regulations and to publish a report within 18 months of them going live. This work is currently underway For further information, see: LNB News 06/07/2022 21, LNB News 05/07/2022 21 and News Analysis: PensionBee warns

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Probate—client guide

Probate—client guide This document provides general guidance regarding the probate procedure for non-professional personal representatives and bereaved family members. Your probate practitioner will be able to provide specific advice based on your circumstances. Dealing with the death of a loved one can involve many challenges, both emotional and practical. If you are also a personal representative (PR) officially dealing with the estate (the property and possessions of the person who has died) as either an executor or an administrator (these terms are explained below), you may find yourself in an unfamiliar situation with unusual and confusing terminology. This guide aims to help you feel more comfortable about your obligations as a PR or what steps you may need to take as a close family member of the person who has died. Introduction to probate There are a number of things that must be dealt with immediately, such as registering the death and arranging the funeral. In time, it is necessary to start dealing with the legal aspects of administering the deceased person’s estate. Unless there are immediate financial concerns and/or property needs to be dealt with for commercial reasons, there should be no harm in waiting for a few weeks. However, note that interest starts to accrue on unpaid inheritance tax (IHT) from six months after the end of month in which the person died and the filing deadline for the

Share purchase agreement—long form pensions warranties (where target company has a defined benefit (DB) scheme)

Share purchase agreement—long form pensions warranties (where target company has a defined benefit (DB) scheme) This precedent has been prepared on the basis that the drafter is acting for the buyer Drafted on the basis that the target company (the Company) is a subsidiary of the Seller. You are strongly advised to involve a pensions specialist at the earliest opportunity. 1 Definitions For the purposes of paragraphs 2 to 9 inclusive: Employee means a present or former employee, officer or director of the Company [or of any Group Company ] [and any other person taking part in the management of the affairs of the Company]; Pension Scheme[s] mean[s] [[name(s) of scheme(s)] OR an arrangement or practice for the payment of, or contribution towards, an annuity, pension, lump sum, gratuity or similar benefit to be given on retirement, ill-health, death or change in service status, or pursuant to a pension sharing order, in relation to the service or historic service of an Employee or any other person, or for the benefit of that individual’s dependants]. 2 No other obligations or commitments Except as provided for by the Pension Scheme[s]: 2.1 [the Company is not OR no Group Company is] participating and never has participated in any agreement or arrangement, or has entered into any obligation or commitment (whether funded or unfunded and whether legally binding or otherwise), to provide or contribute towards any pensions, annuities, lump

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Where a payer of child maintenance receives a pension lump sum from their private pension which is listed on their P60 as gross salary, but is then adjusted as a tax-free amount, will receipt of that sum affect the Child Maintenance Service calculation of child maintenance payable?

Where a payer of child maintenance receives a pension lump sum from their private pension which is listed on their P60 as gross salary, but is then adjusted as a tax-free amount, will receipt of that sum affect the Child maintenance Service calculation of child maintenance payable? A non-resident parent is obliged to pay to the resident parent in respect of a qualifying child maintenance calculated by the Child Maintenance Service (CMS) by reference to the gross income of the former. The CMS is a statutory body which works out, collects and pays out child maintenance payments as is necessary. Where the CMS is tasked with working out child maintenance, it will determine the yearly gross income of the paying parent, and convert it to a weekly figure, then apply a formula based upon that gross weekly income. Various types of different income may or may not be taken into consideration when calculating the gross weekly income. The manner in which this calculation is carried out is set out in the Child Support

Does UCTA 1977 apply to service contracts?

Does UCTA 1977 apply to service contracts? Unfair Contract Terms Act 1977 (UCTA 1977) In general, the Unfair Contract Terms Act 1977 (UCTA 1977) is primarily concerned with liability as between businesses. It provides protection to varying degrees in respect of specific types of liability. It does not deal with all types of liability (for example the law on penalty clauses is not covered by UCTA 1977), nor does it provide rules on the fairness of contract terms generally. To determine whether UCTA 1977 applies, it is therefore necessary to consider both the type of contract and the nature of the liability in question, and to consider both of these factors in light of the various provisions for application and exemption within UCTA 1977. UCTA 1977, s 1(1)(3) provides: ‘(3) In the case of both contract and tort, sections 2 to 7 apply (except where the contrary is stated in section 6(4)) only to business liability, that is liability for breach of obligations or duties arising— (a) from things done or to be done by a person in the course of a business (whether his own business or another's); or (b) from the occupation of premises used for business purposes of the occupier;’ However, this must be read subject to the provisions of UCTA 1977, Sch 1 (section 1(2)) which provides that UCTA 1977, ss 2 and 3 do not extend to: ‘(a) any

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Comment—Wrangle over UK insurance ‘Brexit dividend’ capital cut will go nowhere

MLex: The increasingly political debate over insurance capital cuts in the UK post-Brexit is set to become a top-agenda item when the new prime minister takes over.

Third Party Debt Order against a judgment debtor’s undrawn pension funds-law, practice and procedure (Lindsay v O’Loughnane; Brake and Brake v Guy)

Pensions analysis: In Lindsay v O’Loughnane and Brake and Brake v Guy the Queen’s Bench Division of the High Court shed light on the law of execution against a judgment debtor’s pension funds by Third Party Debt Order (TPDO) under CPR 72. Both cases affirm the procedure under section 37(1) of the Senior Courts Act 1981 (SCA 1981) to bring about the existence of a debt capable of attachment by TPDO as the court granted an injunction forcing the judgment debtor to make available the whole of the pension fund for the purposes of attachment of a TPDO under CPR 72.2, subject only to the taxation arising on drawdown. Written by Brian Hurst, barrister, 39 Park Square, Leeds.

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About this title—authors, overview

ContributorsCHRIS WHITEHOUSE, B.A., B.C.L., Barrister5 Stone Buildings, Lincoln’s Inn, LondonTitle overviewThe title RENTCHARGES AND ANNUITIES (2019) deals with the law and practice of rentcharges so far as they relate to the creation of such rentcharges as survive the general prohibition of new rentcharges after 22 August 1971 introduced by the Rentcharges Act 1977. The range of precedents has been modernised and includes forms of dealings with rentcharges already created; precedents for the apportionment, extinguishment, redemption and release of rentcharges; precedents for the transfer of land subject

43 Discharge of rentcharge by court on sale of land affected

43 Discharge of rentcharge by court on sale of land affectedWhere land subject to an annual sum charged on it is sold or exchanged, the court may, if it thinks fit, on the application of a party to the sale or exchange, allow payment into court of such an amount as, when invested in government securities, will by its dividends provide for the sum charged, together with an additional amount to meet the contingency of further costs, expenses and other contingencies, except depreciation of investments, and may declare the land to be freed from the rentcharge1.

Annuity is referenced 15 in Encyclopaedia of Forms and Precedents

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