Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Defined benefit definition

What does Defined benefit mean? In legal practice, defined benefit (DB) refers to occupational pension benefits fixed by a formula—commonly based on pensionable salary (final salary or career average) and length of service—rather than by the amount of contributions paid or investment performance. The term is used and recognised in UK pensions legislation (including the Pensions Acts and related regulations) and in Ireland (Pensions Act 1990), with broadly consistent usage across England & Wales, Scotland, Northern Ireland and Ireland. Key features include: the sponsoring employer bears the funding and investment risk; trustees obtain regular actuarial valuations; and any deficit must be addressed through...

Managing section 75 employer debts on corporate transactions: triggers, calculation and options (payment, apportionment, withdrawal, deferred debt), trustee/TPR processes, notifiable events, restructuring risks and tax

Published by a LexisNexis Pensions expert

Practice notes

THIS PRACTICE NOTE APPLIES IN RELATION TO defined benefit OCCUPATIONAL PENSION SCHEMES

This Practice Note sets out approaches for addressing a section 75 debt in the context of a transaction, with particular emphasis on multi-employer schemes where a range of options may exist.

It also outlines considerations connected to the pensions regulator's clearance process and the notifiable events regime.

For trustee-focused considerations when deciding how a section 75 debt should be managed on an employment cessation event, see Practice Note: employment cessation events—trustee decision-making process. For matters specific to section 75 debts triggered during a group reorganisation, see Practice Note: Intra-group reorganisations and pensions.

Determining whether a section 75 debt will be triggered

Section 75 debt triggers

A section 75 debt (often called an 'employer debt') may become payable by the employer of a defined benefit occupational pension scheme where:

the scheme is a multi-employer arrangement and an employment cessation event occurs in relation to that employer (described in this Practice Note as a 'cessation employer')—an employment cessation event arises where the cessation employer ceases to have active members in the scheme at a time when at least one other participating employer in the scheme...

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Web page updated on 21/05/2026

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