Pension payment process which allows members to continue to invest their pension funds, while drawing some as income.

FORTHCOMING CHANGE: The Finance Bill 2025–26 includes provisions bringing unused pension funds and death benefits within a deceased member’s estate, and thus within the inheritance tax (IHT) regime, with effect from 6 April 2027. Note that these measures will not apply to death-in-service benefits paid to active members in relevant employment, nor will it apply to a dependant’s scheme pension (defined as a DB scheme spouse’s or dependant’s pension). Standard exemptions, such as those for spouses and civil partners, will also remain in effect. Personal representatives will be primarily responsible for paying IHT. For further information, see Practice Note: Inheritance tax and pensions, News Analyses: HMRC—Reforming inheritance tax—unused pension funds and death benefits, HMRC confirms new IHT rules on unused pension funds to apply from 6 April 2027, and HMRC policy paper: Inheritance Tax: unused pension funds and death benefits (November 2025). Where a member of a registered pension scheme (being a scheme offering flexible benefits) dies while in drawdown (whether in the form of income withdrawal or a short-term annuity),

THIS PRACTICE NOTE RELATES TO DRAWDOWN PENSIONS WHICH COMMENCED BEFORE 6 APRIL 2011 ARCHIVED: This archived Practice Note looks at the legal regime applicable to drawdown arrangements under registered pension schemes entered into before 6 April 2011, a time when such arrangements were then known as ‘unsecured pension’ and ‘alternatively secured pension’. This archived Practice Note is not maintained. For information on the legal regimes applicable to drawdown arrangements on or after 6 April 2011, see Practice Notes: • Drawdown between 6 April 2011 and 5 April 2015 [Archived] • Drawdown from 6 April 2015 • Drawdown and death benefits from 6 April 2015 What is a drawdown pension? The A-day tax simplification changes, which came into force on 6 April 2006 introduced a new drawdown regime for registered pension schemes which replaced the limited ability to drawdown pensions which existed prior to that date. The A-day changes introduced the concept of the ‘unsecured pension’ and the ‘alternatively secured pension’. The term ‘drawdown pension’ replaced these terms following changes

THIS PRACTICE NOTE RELATES TO DRAWDOWN PENSIONS COMMENCING BETWEEN 6 APRIL 2011 AND 5 APRIL 2015 (INCLUSIVE) ARCHIVED: This archived Practice Note looks at the legal regime applicable to drawdown arrangements entered into on or after 6 April 2011 and before 6 April 2015 (whether in the form of income withdrawal or a short-term annuity). It is not maintained. For information on the legal regime applicable to drawdown arrangements entered into on or after 6 April 2015, see Practice Notes: Drawdown from 6 April 2015 and Drawdown and death benefits from 6 April 2015. What is a drawdown pension? The term ‘drawdown pension’ replaces the terms ‘unsecured pension’ and ‘alternatively secured pension’ which were used before 6 April 2011. Before 6 April 2015, drawdown pension referred to the pension payment process which permitted members who were: • already in receipt of benefits from a pension arrangement (whether in the form of a pension payable by the scheme or an annuity purchased with the member’s scheme funds), and

THIS PRACTICE NOTE APPLIES IN RELATION TO MONEY PURCHASE ARRANGEMENTS FROM 6 APRIL 2015 On 6 April 2015, pension flexibilities were introduced to widen the retirement options available to defined contribution (DC) members and other members with 'flexible benefits' (essentially money purchase and/or cash balance benefits). As part of the flexibilities introduced, drawdown became more widely available. For more information on the pension flexibilities introduced on 6 April 2015, see Practice Note: Pension freedoms—an introduction [Archived]. This Practice Note focuses on the legal regime applicable to drawdown arrangements created on and from 6 April 2015. It also considers the treatment of pre-April 2015 drawdown arrangements on and from that date. For information on the legal regime that applied to drawdown arrangements before 6 April 2015, see Practice Note: Drawdown between 6 April 2011 and 5 April 2015 [Archived]. What is drawdown? The term ‘drawdown pension’ (sometimes referred to as 'flexible income') replaces the terms ‘unsecured pension’ and ‘alternatively secured pension’ which were used before 6 April 2011. Drawdown pension refers to the pension payment

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Funds (whether sums or assets) held under a money purchase arrangement that were ‘designated’ before 6 April 2015 to provide a scheme member or dependant with a drawdown pension (whether in the form of Income Withdrawal or through the purchase of a Short-Term Annuity). Once sums or assets have been ‘designated’ as part of a drawdown pension fund, any capital growth or income generated from such sums or assets are equally treated as being part of the drawdown pension fund. Similarly, where assets are purchased at a later date from such funds, or sums generated by the sale of assets held in such funds, those replacement assets or sums also fall as part of the drawdown pension fund (as do any future growth or income generated by those assets or sums).

Lump sum death benefit paid from a drawdown pension fund created before 6 April 2015. This lump sum must satisfy the conditions set out in the Finance Act 2004, Sch 29, Pt 2, para 17.

The twelve-month period from when a member first became entitled to a drawdown pension. This term is relevant to Capped Drawdown arrangements entered into before 6 April 2015.

Drawdowns under a MTN programme Name of document Form of document To be executed, or (if applicable) issued, by or on behalf of Signatories Executed? Subscription agreementThis document is an alternative to the dealer confirmation. It is to be used for syndicated drawdowns. This document is based on the form set out in the programme agreement. For drawdowns under MTN programmes, Dealers (as defined in the programme agreement) are referred to as Managers. Managers includes the Lead Managers. Agreement Issuer [insert details of Issuer’s authorised signatory / signatories] [Guarantor(s)]Include if the Issuer's obligations are guaranteed under the MTN programme. [insert details of each Guarantor’s authorised signatory / signatories] [insert details of each Manager] (the Managers) [insert details of each Manager’s authorised signatory / signatories] Dealer confirmationThis document is to be used where only one Manager is subscribing for the notes. This document is based on the form set out in the programme agreement. Letter

PI & Clinical Negligence analysis: The High Court has re-affirmed the stance on secondary victim claims arising out of clinical negligence, as established in Paul v Royal Wolverhampton NHS Trust [2024] UKSC 1. HHJ Evans held that to be successful, a secondary victim must have witnessed an accident which caused (or had the capacity to cause) injury to the primary victim. In this case, MIM had not witnessed an ‘accident’ as per the definition in Paul and, therefore, his claim as a secondary victim could not succeed. The claim was struck out. This decision confirms what many suspected following the determination of the Supreme Court in Paul: successful recovery for secondary victims arising out of clinical negligence will be rare. Written by Georgia Banks, barrister at Parklane Plowden Chambers.

Arbitration analysis: The Supreme Court of the Federation of Bosnia and Herzegovina dismissed P. d.d.’s appeal and upheld the Cantonal Court in Sarajevo’s recognition of a final International Chamber of Commerce (ICC) arbitral award made in Switzerland. The decision draws a firm line on the limits of challenging foreign arbitral awards in Bosnia and Herzegovina (BiH)—courts conduct a strictly limited review, checking only the procedural conditions for recognition rather than re-examining the tribunal’s factual findings, contractual interpretation or application of the governing law. This confirms Bosnia and Herzegovina’s pro-enforcement approach under the 1958 New York Convention, the international treaty requiring courts to respect and enforce foreign awards subject to limited exceptions, together with domestic conflict-of-laws rules. The court also confirmed that reciprocity between states is presumed unless the objecting party proves otherwise. Finally, P. d.d. could not prevent recognition by relying on its own failure in Switzerland to comply with procedural requirements -designating a service address and paying the appeal cost advance. This provides a clear warning for parties participating in foreign arbitration. Produced in partnership with Ilma Kasumagic, attorney at law, in cooperation with Wolf Theiss.