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.

  SAFEGUARDED-FLEXIBLE PENSION BENEFITS: DWP GUIDANCE
The DWP has today published non-statutory 'best practice' guidance on the regulations which require trustees and scheme managers ('providers') to:

  • send tailored communications (personalised risk warnings) to members with safeguarded-flexible benefits;

  • use the transfer value of members' safeguarded benefits, when assessing whether the value

of their pension pots is above the threshold at which they are required to take financial advice; and

  • make transitional arrangements to inform members who are affected by the change in valuation methodology.

The DWP has taken this step as a result of the Pension Schemes Act 2015 (Transitional Provisions and Appropriate Independent Advice) (Amendment) Regulations 2017 (SI 2017/717) (the

'risk warning regs') and the Pension Schemes Act 2015 (Transitional Provisions and Appropriate Independent Advice) (Amendment No.2) Regulations 2017 (the 'valuation regs', currently in draft form). Both sets of regs (on which we reported earlier) amend the Pension Schemes Act 2015 (Transitional Provisions and Appropriate Independent Advice) Regulations 2015 (SI 2015/742) and both are due to come into force on . . .

13 Nov 2017  

  VAT: AT EASE
Via its VAT Input Tax (VIT) manual, HMRC has published revised guidance for funded occupational pension schemes. In a nutshell, current arrangements for recovery of VAT on pension costs can continue.

Following the Court of Justice of the European Union (CJEU) decision in the PPG case*, for several years HMRC has been reviewing its rules, which included suggestions that it might withdraw existing arrangements.

* The CJEU decided that, subject to certain conditions, the employer (PPG) was entitled to deduct the VAT it paid on services relating to both administration and investment of the assets of the pension fund. This was contrary to the position previously taken by HMRC, whereby the VAT on administration services was deductible by the employer but not the VAT on investment services.

In the revised guidance - starting at

VIT 44650 - an employer may be able to deduct VAT incurred both on investment and administration services. They will need to be involved in the contract, as well as being invoiced and paying for the services. This might be facilitated via VAT grouping (employer and trustees); onward supply by the trustees of services in running the pension scheme; or (for DB schemes only) a tripartite contract between a service supplier, trustees, . . .

10 Nov 2017  

  NEST ALTERATIONS
This week the DWP launched a new consultation on amendments to The National Employment Savings Trust (NEST) Order 2010 (SI 2010/917) to:

  • allow participating employers to contractually enrol their employees in NEST;

  • clarify that individuals may join NEST in the event of a 'bulk transfer with consent' and require that any amount must be applied to a member's

account as a result of a bulk transfer;

  • give NEST Corporation the ability to close members' pension accounts that have zero funds if certain conditions are met; and

  • require NEST Corporation to carry out research with scheme members and participating employers and their representatives, in connection with the operation, development or amendment of the scheme.

This will allow NEST to demonstrate that it meets the GDPR requirements on lawful data processing when carrying out research.

The first of these changes follows an earlier consultation. At present, workers contractually enrolling the entire workforce, including those not eligible for automatic enrolment, cannot use NEST for all its employees. Most respondents to . . .

10 Nov 2017  

  BULK TRANSFERS. NO CONSENT.
The DWP has commenced a period of consultation seeking views on draft regulations which would:

1. replace the requirement to obtain an actuarial certificate for bulk transfers of defined contribution (DC) pensions without member consent ('pure' DC to DC transfers) with an alternative test and new member protections;

2. remove the scheme relationship condition for these transfers; and

3. maintain charge cap protections for those transferred without consent

The consultation document goes further:

1. Actuarial certificate (scheme quality condition)

The current legislation governing bulk transfers without consent, such as the requirement to obtain an actuarial certificate, is not entirely appropriate for DC to DC transfers.

The Government admits that actuaries may not be the most appropriate professionals to assess receiving DC schemes.

The proposal then is to remove the need to obtain an actuarial certificate for 'pure' DC-DC transfers where there are no potentially valuable guarantees or options to be assessed.

Where the transfer is to a scheme . . .

27 Oct 2017  

  LOOK OUT, THEY'RE CHARGING!
The DWP has launched a consultation seeking views on proposals for trustees and managers of certain occupational schemes - those providing money purchase benefits and currently required to produce an annual Chair's Statement - to:

  • publish information about costs and charges and tell members where they can find it;

  • provide information, if a member asks, about the funds in which

their money is invested.

The aim, the Government states, is to "assist the function of a healthy market in an area which is perceived as being opaque" and allow easy assessment of value for money.

Chapter 1 of the consultation document sets out the following proposals:

  • the requirement to publish charge and transaction cost information and

disclose this to members, beneficiaries of the scheme and others including recognised trade unions should apply, subject to a small number of exceptions, to schemes that provide money purchase benefits;

  • that both the Chair's Statement and published cost and charge information should set out the costs and charges for each default . . .

26 Oct 2017  

 
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