Alternatively secured pension fund meaning

In practice, an alternatively secured pension fund was the pot of assets or cash within a defined contribution (money purchase) arrangement that, once the member was aged 75 or over, had been formally designated to pay an alternatively secured pension (ASP) instead of purchasing an annuity. The term was created in UK pensions tax legislation (Finance Act 2004, Schedule 28, paragraph 11) and applied across England & Wales, Scotland and Northern Ireland; it is not used in Irish pensions law. An ASP fund was a statutory form of income drawdown available only until 6 April 2011. From that date, under the Finance Act 2011 reforms, ASP and ASP funds were abolished and any existing ASP fund was automatically treated as a drawdown pension fund (capped drawdown), with the corresponding drawdown and death benefit tax rules. Key legal features were: designation of scheme-held sums or assets for the member; income withdrawal subject to statutory limits and review periods; and specific tax and death benefit provisions distinct from annuities. Although now historic, the expression remains relevant when construing legacy scheme documents, advising on historic HMRC tax charges, and confirming correct reclassification and tax treatment from 6 April 2011 onwards.