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Finance Bill


Finance Bill
Part 4 — Pension schemes etc
Chapter 2 — Registration of pension schemes

146

 

(2)   

If the Inland Revenue withdraws the registration of a pension scheme the

Inland Revenue must notify the scheme administrator.

(3)   

If there is no-one who is the scheme administrator, the Inland Revenue must

instead notify any person or persons—

(a)   

who has or have responsibility for the discharge of any obligation

5

relating to the pension scheme under section 265(4) (continuation of

liability where no scheme administrator), section 266 (trustees etc.) or

section 267 (members), and

(b)   

whom it is reasonably practicable for the Inland Revenue to identify.

(4)   

The notification must state the date on and after which the pension scheme will

10

not be a registered pension scheme.

155     

Grounds for de-registration

(1)   

The registration of a pension scheme may be withdrawn under section 154 only

if it appears to the Inland Revenue—

(a)   

that the amount of the scheme chargeable payments (see section 237)

15

made by the pension scheme during any period of 12 months exceeds

the de-registration threshold,

(b)   

that the scheme administrator fails to pay a substantial amount of tax

(or interest on tax) due from the scheme administrator by virtue of this

Part,

20

(c)   

that the scheme administrator fails to provide information required to

be provided to the Inland Revenue by virtue of this Part and the failure

is significant,

(d)   

that any information contained in the application to register the

pension scheme or otherwise provided to the Inland Revenue is

25

incorrect in a material particular,

(e)   

that any declaration accompanying that application or the provision of

other information to the Inland Revenue is false in a material particular,

or

(f)   

that there is no scheme administrator.

30

(2)   

The amount of the scheme chargeable payments made by a pension scheme

during any period of 12 months exceeds the de-registration threshold if the

scheme chargeable payments percentage is 25% or more.

(3)   

The scheme chargeable payments percentage is—

(a)   

if only one scheme chargeable payment is made during the period of 12

35

months, the percentage of the pension fund used up on the occasion of

that scheme chargeable payment, and

(b)   

if two or more scheme chargeable payments are made during the

period of 12 months, the aggregate of the percentages of the pension

fund used up on the occasion of each of those scheme chargeable

40

payments.

(4)   

The percentage of the pension fund used up on the occasion of a scheme

chargeable payment is—equation: cross[over[times[char[S],char[C],char[P]],times[char[A],char[A]]],num[100.00000000,

"100"]]

where—

SCP is the amount of the scheme chargeable payment, and

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Finance Bill
Part 4 — Pension schemes etc
Chapter 3 — Payments by registered pension schemes

147

 

AA is an amount equal to the aggregate of the amount of the sums and

the market value of the assets held for the purposes of the pension

scheme at the time when the scheme chargeable payment is made.

(5)   

A failure by a scheme administrator to provide information required to be

provided to the Inland Revenue by or under this Part is significant if—

5

(a)   

the amount of information which the scheme administrator fails to

provide is substantial, or

(b)   

the failure to provide the information is likely to result in serious

prejudice to the assessment or collection of tax.

156     

Appeal against decision to de-register

10

(1)   

This section applies where the Inland Revenue decides to withdraw the

registration of a pension scheme under section 154.

(2)   

The scheme administrator, or any person notified under that section of the

withdrawal of registration, may appeal against the decision.

(3)   

The appeal is to the General Commissioners, except that the appellant may

15

elect (in accordance with section 46(1) of TMA 1970) to bring the appeal before

the Special Commissioners instead of the General Commissioners.

(4)   

Paragraphs 1, 2, 8 and 9 of Schedule 3 to TMA 1970 (rules for assigning

proceedings to General Commissioners) have effect to identify the General

Commissioners before whom an appeal under this section is to be brought, but

20

subject to modifications specified in an order made by the Board of Inland

Revenue.

(5)   

An appeal under this section against a decision must be brought within the

period of 30 days beginning with the day on which the appellant was notified

of the decision.

25

(6)   

The Commissioners before whom an appeal under this section is brought must

consider whether the registration of the pension scheme ought to have been

withdrawn.

(7)   

If they decide that the registration of the pension scheme ought to have been

withdrawn, they must dismiss the appeal.

30

(8)   

If they decide that the registration of the pension scheme ought not to have

been withdrawn, the pension scheme is to be treated as having remained a

registered pension scheme (but subject to any further appeal or any

determination on, or in consequence of, a case stated).

Chapter 3

35

Payments by registered pension schemes

Introductory

157     

Payments by registered pension schemes

(1)   

The only payments which a registered pension scheme is authorised to make

to or in respect of a member of the pension scheme are those specified in

40

section 161.

 

 

Finance Bill
Part 4 — Pension schemes etc
Chapter 3 — Payments by registered pension schemes

148

 

(2)   

In this Part “unauthorised member payment” means—

(a)   

a payment by a registered pension scheme to or in respect of a member

of the pension scheme which is not authorised by section 161, and

(b)   

anything which is to be treated as an unauthorised payment to or in

respect of a member of the pension scheme under section 168, 169 or

5

170.

(3)   

The only payments which a registered pension scheme that is an occupational

pension scheme is authorised to make to or in respect of a sponsoring employer

are those specified in section 171.

(4)   

In this Part “unauthorised employer payment” means—

10

(a)   

a payment by a registered pension scheme that is an occupational

pension scheme, to or in respect of a sponsoring employer, which is not

authorised by section 171, and

(b)   

anything which is to be treated as an unauthorised payment to a

sponsoring employer under section 177.

15

(5)   

In this Part “unauthorised payment” means—

(a)   

an unauthorised member payment, or

(b)   

an unauthorised employer payment.

(6)   

As well as section 154 (de-registration), the following provisions—

(a)   

section 204 (unauthorised payments charge),

20

(b)   

section 205 (unauthorised payments surcharge),

(c)   

section 235 (scheme sanction charge), and

(d)   

section 238 (de-registration charge),

   

specify consequences of making unauthorised payments.

(7)   

Sections 178 to 181 contain provision about amounts that a registered pension

25

scheme is not authorised to borrow.

(8)   

As well as section 154, sections 235 and 238 specify consequences of

unauthorised borrowing.

(9)   

Schedule 34 contains (in Parts 3 and 4) transitional provision about

unauthorised payments.

30

158     

Meaning of “payment” etc

(1)   

This section applies for the interpretation of this Chapter.

(2)   

“Payment” includes a transfer of assets and any other transfer of money’s

worth.

(3)   

Subsection (4) applies to a payment made or benefit provided under or in

35

connection with an investment (including an insurance contract or annuity)

acquired using sums or assets held for the purposes of a registered pension

scheme.

(4)   

The payment or benefit is to be treated as made or provided from sums or

assets held for the purposes of the pension scheme, even if the pension scheme

40

has been wound up since the investment was acquired.

(5)   

A payment made by a registered pension scheme to a person who—

(a)   

is connected with a member or sponsoring employer (or was connected

with a member at the date of the member’s death), and

 

 

Finance Bill
Part 4 — Pension schemes etc
Chapter 3 — Payments by registered pension schemes

149

 

(b)   

is not a member or sponsoring employer,

   

is to be treated as made in respect of the member or sponsoring employer.

(6)   

Any asset held by a person connected with a member or sponsoring employer

(or who was connected with a member at the date of the member’s death) is to

be treated as held for the benefit of the member or sponsoring employer.

5

(7)   

Any increase in the value of an asset held by, or reduction in the liability of, a

person connected with a member or sponsoring employer (or who was

connected with a member at the date of the member’s death) is to be treated as

an increase or reduction for the benefit of the member or sponsoring employer.

(8)   

Section 839 of ICTA (connected persons) applies for the purposes of this

10

section.

159     

Meaning of “loan”

(1)   

This section applies for the interpretation of this Chapter.

(2)   

“Loan” does not include the purchase of or subscription to debentures,

debenture stock, loan stock, bonds, certificates of deposit or other instruments

15

creating or acknowledging indebtedness which are—

(a)   

listed or dealt in on a recognised stock exchange (within the meaning of

section 841 of ICTA), or

(b)   

offered to the public.

(3)   

A guarantee of a loan made to or in respect of a member or sponsoring

20

employer of a registered pension scheme is to be treated as a loan to or in

respect of the member or sponsoring employer of an amount equal to the

amount guaranteed.

(4)   

If a member or sponsoring employer of a registered pension scheme—

(a)   

is liable to pay a debt, the right to payment of which constitutes an asset

25

held for the purposes of the pension scheme, but

(b)   

is not required to pay it by the relevant date,

   

the debt is to be treated as a loan made by the pension scheme to the member

or sponsoring employer on that date.

(5)   

The relevant date is the date by which a person at arm’s length from the

30

pension scheme might be expected to be required to pay the debt.

160     

Meaning of “borrowing” etc

(1)   

This section applies for the interpretation of this Chapter.

(2)   

Borrowing is borrowing by a registered pension scheme if the amount

borrowed is to be repaid from sums or assets held for the purposes of the

35

pension scheme.

(3)   

A liability is a liability of a registered pension scheme if the liability is to be met

from sums or assets held for the purposes of the pension scheme.

(4)   

Borrowing by a registered pension scheme is in respect of an arrangement if it

is properly attributable to the arrangement in accordance with the provisions

40

of the pension scheme and any just and reasonable apportionment.

 

 

 
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