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‘Does a pension entitlement in respect of which a bankrupt has a present right to elect to draw down payment (but which he has not yet exercised) fall to be included in the assessment of his income ‘to which he from time to time becomes entitled’ within the meaning of section 310(7) of the Insolvency Act when the court is considering whether and, if so, on what terms, to make an IPO under section 310?’
Formerly entitled the Ancillary Relief Handbook this is the first resort for thousands of...
‘In short, the position since 1999 has been that rights under personal pension arrangements do not in general vest in a trustee in bankruptcy. Nevertheless, as has always been the case with occupational pensions, provision has been maintained for an IPO to be made in certain circumstances. It may be thought that the parenthetical words in section 310(7) [i.e. ‘(despite anything in section 11 or 12 of the Welfare Reform and Pensions Act 1999)’] were required in order to ensure that the position under personal pension policies did not diverge from that applicable to occupational pension schemes. There was no question of the 1999 Act going so far as to protect from creditors all income of a bankrupt even where such income stems from a pension. This was also the case as regards occupational pension schemes under the 1995 Act: see section 91(4)’