PENSIONS NEWS

Aries monitors every development in new and proposed legislation and official guidance.   Clients are kept up to date via the website, email alerts and tweets.   Aries serves as a one-stop source of intelligence on everything that is going on and coming up.   Aries doesn't miss anything of significance.

Here is a selection from our most recent headlines. You can get the fuller details by sending us an email - just click here to fire one off.

  MASTER TRUST: FORMS OF READINESS
This is a process known as a 'readiness review' and it was flagged last month when TPR launched its consultation on the draft Master Trust Code. The forms and associated guidance (where necessary) are:

Scheme financial details:   The Template and the Guidance

Scheme funder:   The Exemption Request Form and Participating Employers Form

TPR makes the point that formidable as this raft of documentation looks, it does not cover everything. A summary of "requirements and evidence you will need to consider and provide when completing your draft authorisation application,

as part of the readiness review" runs to six pages.

The online portal for submission of these forms will be available from early May until 15 June 2018. TPR will offer guidance about the quality of the evidence in the draft application by the end of August 2018. It will not offer feedback on whether the application would be successful. . . .

20 Apr 2018  

  MANAGE & REGISTER PENSION SCHEMES SERVICE NEWSLETTER
As catchy titles go, this one isn't up there with the best but HMRC's Pension schemes Manage and Register Pension Schemes Service Newsletter provides more information for administrators about the new service due to replace Pension Schemes Online. The Manage and Register Pension Schemes service will:

  • provide a new digital platform for you to manage and register your pension schemes;
  • provide a digital account for all pension schemes and reporting;
  • issue all HMRC notifications regarding registration; and
  • hold details of existing pension schemes, pension scheme administrators and pension practitioners following migration from the existing Pension Schemes Online service.
  • Roll-out will be in two phases; the first is scheduled to begin on 8 May 2018 (ie a month later than originally promised).

    From 6pm on 4 May 2018, it will no longer be possible to apply to register a pension scheme on the existing Pension Schemes Online service - so there will a few days lag until the new service is available on the 8th. HMRC assures that it will not decommission the old service until it is confident the new service will be able to:

    • successfully manage pension schemes and fulfil reporting . . .

    19 Apr 2018  

      PENSION FREEDOMS : HOUSE OF COMMONS WORK AND PENSIONS COMMITTEE REPORT
    On 28 March 2018, the House of Commons Work and Pensions Committee made public a new Report on Pension Freedoms. The Report makes a number of recommendations which we list below together with our comments.

    • The Government should respond on the long-term objectives of pension freedoms; and how it will monitor and report on performance outcomes.

    Aries comment
    "No-one will have to buy an annuity" is hardly a policy. The government stands accused of abdicating responsibility for the consequences of pension freedom. By scrapping the former minimum income requirement for accessing flexible drawdown as part of the new freedoms, the government in 2014 was declaring it had no interest in the extent to which pension savers exhaust their savings before death, and fall back on state benefits.

    • The Government should take forward, by April 2019, FCA proposals to introduce default decumulation pathways. Any provider offering drawdown would be required by FCA rules to offer a default solution that is targeted at their core customer group. The same 0.75% charge cap that applies to automatic enrolment schemes . . .

    16 Apr 2018  

      DB FUNDING STATEMENT
    The Pensions Regulator (TPR) has published its Annual Funding Statement for defined benefit (DB) pension schemes. The headline is a warning: trustees and sponsoring employers of DB schemes must do more to protect member benefits.

    'Strong' employers should consider contributing more money to reduce scheme deficits over a shorter period of time, especially where they are paying out high dividends. Where there is a weak employer, trustees and employers should

    work together to give greater consideration to the needs of the scheme. Last year, the average length of a recovery plan was eight years.

    TPR's warning stems from concerns about the growing disparity between dividends and deficit-reduction payments and expects fair treatment between shareholders and trustees. While dividends may be the most common form of distributions, trustees should also be alert to other forms of covenant leakage (ie when value leaves the

    company) - for example loans to intra-group companies - when considering what contributions are affordable and whether the scheme is being treated fairly.

    If a scheme is not treated fairly, TPR will act by using existing powers, while working with the Government to implement new powers proposed in DWP's DB White Paper.

    TPR has stepped up its proactive DB . . .

    09 Apr 2018  

      HAPPY NEW TAX FORMS & GUIDANCE
    Various pension scheme forms and guidance have been updated for the new tax year:

    Relief at Source Annual Claims (APSS 106)

    Relief at Source RAS Spreadsheet

    Relief at Source Reclaim Guidance

    Relief at Source Annual Information Return Guidance

    Pension Administrators: Reporting to HMRC Guidance

    Aries comment
    We were very disappointed to find the following error, which HMRC has known about for nearly two years, repeated in this fresh guidance on Event 22 today: the sentence beginning "This will only apply" is wrong - it applies to Event 23.   Event 22 applies if an individual has pension savings greater than the Annual Allowance in that scheme for that tax year.

    We quote the offending text:

      "22 The scheme administrator has to automatically issue a pension savings statement for 2014 to 2015 or a standard pension savings statement for 2015 to 2016 onwards. This will only apply where the member has either: - flexibly accessed their money purchase pension rights . . .

    06 Apr 2018  

     
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