Total amount paid out to purchase lifetime annuities and scheme pensions

Lifetime annuity

An annuity contract purchased under a money purchase arrangement from an insurance company of the member's choosing that provides the member with an income for life and which meets the conditions imposed through paragraph 3, Schedule 28 to Finance Act 2004.

Scheme pension

A pension entitlement provided to a member of a registered pension scheme, the entitlement to which is an absolute entitlement to a lifetime pension under the scheme that cannot be reduced year on year (except in narrowly defined circumstances) and meets the conditions laid down in paragraph 2 of Schedule 28 to Finance Act 2004.