Transfers of Section 9(2B) rights and GMPs from 6 April 2016

The following Pensions practice note provides comprehensive and up to date legal information covering:

  • Transfers of Section 9(2B) rights and GMPs from 6 April 2016
  • Why might COSR rights be transferred?
  • Differences between pre-abolition and post-abolition transfer regime
  • Bulk transfer of COSR rights (accrued and in payment) without member consent—connected employer transfers
  • Which schemes can receive a bulk transfer without member consent?
  • What is a connected employer transfer?
  • Conditions for transfer of Section 9(2B) rights
  • Conditions for transfer of GMPs
  • Individual transfer of COSR rights to a former COSR scheme
  • Transfer of accrued Section 9(2B) rights
  • More...

Transfers of Section 9(2B) rights and GMPs from 6 April 2016

Contracting-out on a salary-related basis (also known as defined benefit (DB) contracting-out) was abolished on 6 April 2016. Members of schemes that were contracted-out salary-related (COSR) schemes pre-abolition may have accrued one of two types of contracted-out rights:

  1. guaranteed minimum pensions (GMPs), which are contracted-out rights accrued before 6 April 1997, or

  2. Section 9(2B) rights (also known as post-1997 contracted-out salary-related rights or post-1997 COSR rights), which are contracted-out rights accrued between 6 April 1997 and 5 April 2016

These contracted-out rights are jointly referred to in this Practice Note as 'contracted-out salary-related rights' or 'COSR rights' for short.

The legal regime governing transfers of COSR rights is set out in the Contracting-out (Transfer and Transfer Payment) Regulations 1996, SI 1996/1462 (the Contracting-out Transfer Regulations). HMRC has also published guidance concerning the transfer of COSR rights.

This Practice Note covers transfers made following the abolition of DB contracting-out, ie on and from 6 April 2016.

For information on transfers of COSR rights made before the abolition of DB contracting-out, see Practice Note: Transfers of Section 9(2B) rights and GMPs before 6 April 2016 [Archived].

For information on the transfer of protected rights (ie contracting-out rights accrued in a scheme contracted-out on a money purchase basis) since 6 April 2012, see Practice Note:

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