Transfer Value
The capital sum that can be transferred from one pension scheme to another when a member leaves, calculated as a cash equivalent of their accrued benefits. Members have a statutory right to a cash equivalent transfer value (CETV) under the Pension Schemes Act 1993.
Independent editorial summary — not the official statute text. Read the official version on legislation.gov.uk.
Section 94 of the Pension Schemes Act 1993 gives members of pension schemes a statutory right to a 'cash equivalent' transfer value. A member who has received a statement of entitlement under section 93A acquires a right to take the cash equivalent shown in that statement in accordance with this Chapter, allowing them to transfer the capital value of their accrued pension rights to another arrangement — for example, on changing employer or consolidating several pension pots into one scheme.
The statutory right is not confined to traditional defined benefit members: a member of a pension scheme who has transferrable rights in relation to money purchase benefits acquires a right to take their cash equivalent under the same statutory framework. In practice, transfer values for defined benefit schemes are calculated by the scheme actuary and can fluctuate significantly with market conditions, which is one reason members are usually given only a limited window in which a quoted transfer value remains guaranteed.
Related terms
Official sources
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