|
| |
|
| |
(a) | in the case of a policy of insurance within sub-paragraph (3), is 20th |
| |
| |
(b) | in the case of a policy of insurance within sub-paragraph (4), is the |
| |
time when it became a protected policy. |
| 5 |
(7) | A variation of the terms of a policy made in order to comply with the |
| |
Employment Equality (Age) Regulations 2006 (S.I. 2006/1031) or |
| |
Employment Equality (Age) Regulations (Northern Ireland) 2006 (S.R. |
| |
2006/261) (or any regulations amending or replacing them) is to be ignored |
| |
for the purposes of sub-paragraph (5). |
| 10 |
Power to amend commencement provisions |
| |
8 (1) | The Commissioners for Her Majesty’s Revenue and Customs may by |
| |
regulations amend paragraphs 4 to 7. |
| |
(2) | Regulations under sub-paragraph (1) having the effect of limiting the |
| |
contributions which are life assurance premium contributions may be made |
| 15 |
so as to have effect in relation to times before they are made. |
| |
| |
| |
Alternatively secured pensions and transfer lump sum death benefit etc |
| |
| |
1 | Part 4 of FA 2004 (pension schemes etc) is amended as follows. |
| 20 |
Alternatively secured pension: guaranteed pension and maximum |
| |
2 (1) | In section 165(1) (pension rules) is amended as follows. |
| |
(2) | In pension rule 2 (guaranteed pensions)— |
| |
(a) | for “, an annuity or alternatively secured pension” substitute “or an |
| |
| 25 |
(b) | for “, annuity or alternatively secured pension” substitute “or |
| |
| |
(3) | In pension rule 7 (maximum alternatively secured pension), for “70%” |
| |
| |
3 | In paragraph 12 of Schedule 28 (pension rules: alternatively secured pension |
| 30 |
year), omit sub-paragraphs (3) and (4) (guaranteed pensions). |
| |
Maximum dependants’ alternatively secured pension |
| |
4 | In section 167(1) (pension death benefit rules), in pension death benefit rule |
| |
6 (maximum dependants’ alternatively secured pension), for “70%” |
| |
| 35 |
|
| |
|
| |
|
Abolition of transfer lump sum death benefit |
| |
5 | In section 168(1) (lump sum death benefit rule), omit paragraph (g) (transfer |
| |
| |
6 | Omit section 172B(5)(a) (reduction for transfer lump sum death benefit). |
| |
7 | In section 188(5) (amounts not to be treated as contributions), omit |
| 5 |
paragraph (b) and the word “and” before it. |
| |
8 | In section 280(2) (index), omit the entry relating to transfer lump sum death |
| |
| |
9 | In Schedule 29, omit paragraph 19 (transfer lump sum death benefit). |
| |
10 | In paragraph 17A of Schedule 36 (“enhanced protection”)— |
| 10 |
(a) | in sub-paragraph (1), insert “or” after paragraph (a) and omit |
| |
paragraph (c) and the word “or” before it, and |
| |
(b) | in sub-paragraph (2), omit “, or to a transfer lump sum death benefit |
| |
| |
| 15 |
11 | In paragraph 11 of Schedule 28 (member’s alternatively secured pension |
| |
fund), insert at the end— |
| |
“(6) | Sub-paragraph (7) applies if— |
| |
(a) | at the time when the member reaches the age of 75, the |
| |
scheme administrator has been unable to ascertain the |
| 20 |
member’s whereabouts after having taken all reasonable |
| |
| |
(b) | paragraph 8(2) applies in relation to the member and the |
| |
arrangement and none of the sums or assets held for the |
| |
purposes of the arrangement are member-designated |
| 25 |
funds immediately before it applies. |
| |
(7) | In that case the references in sub-paragraphs (2) and (3) to the time |
| |
when the member reached the age of 75 are to be read as referring |
| |
to the end of the period of six months beginning with any later |
| |
date on which the member’s whereabouts are subsequently |
| 30 |
ascertained by the scheme administrator.” |
| |
Increase in rights on death |
| |
12 (1) | Section 172B (increase in rights of connected person on death) is amended as |
| |
| |
(2) | In subsection (2)(b), for “, alternatively secured pension fund, dependant’s |
| 35 |
unsecured pension fund or dependant’s alternatively secured” substitute |
| |
“or dependant’s unsecured”. |
| |
(3) | In subsection (4), for “(6)” substitute “(5)”. |
| |
(4) | In subsection (7)(a), after “there” insert “are”. |
| |
|
| |
|
| |
|
(5) | After subsection (8) insert— |
| |
“(8A) | Nothing in this section applies in relation to the rights representing |
| |
the member’s unsecured pension fund if those rights would |
| |
represent the member’s alternatively secured pension fund but for |
| |
paragraph 11(6) and (7) of Schedule 28.” |
| 5 |
13 | After that section insert— |
| |
“172BA | Increase in rights on death arising from alternatively secured |
| |
| |
(1) | This section applies if, at any time (“the relevant time”) after the |
| |
death of a member of a registered pension scheme, another member |
| 10 |
of the pension scheme becomes entitled to alternatively secured |
| |
| |
(2) | “Alternatively secured rights” are rights representing the whole or |
| |
part of the dead member’s alternatively secured pension fund, or |
| |
dependant’s alternatively secured pension fund, in respect of an |
| 15 |
arrangement under the pension scheme. |
| |
(3) | The pension scheme is to be treated as making an unauthorised |
| |
payment to the other member (or to the other member’s personal |
| |
| |
(4) | Subject to subsection (5), the amount of the unauthorised payment is |
| 20 |
| |
(a) | the consideration which might be expected to be received in |
| |
respect of an assignment (or assignation) of the benefits to |
| |
which the other member is actually or prospectively entitled |
| |
under the pension scheme immediately after the relevant |
| 25 |
| |
(b) | the consideration which might be expected to be received in |
| |
respect of such an assignment (or assignation) immediately |
| |
before the relevant time. |
| |
(5) | But that amount is to be reduced by so much (if any) of the excess as |
| 30 |
arises from the other member becoming entitled to pension death |
| |
benefits or lump sum death benefits in respect of the dead member. |
| |
(6) | This section does not apply if the other member’s entitlement to the |
| |
alternatively secured rights is brought about by an assignment (or |
| |
agreement to assign) within section 172. |
| 35 |
(7) | Rights representing the member’s unsecured pension fund are |
| |
alternatively secured rights for the purposes of this section if they |
| |
would be rights representing the member’s alternatively secured |
| |
pension fund but for paragraph 11(6) and (7) of Schedule 28.” |
| |
|
| |
|
| |
|
Minimum alternatively secured pension and dependants’ alternatively secured pension |
| |
14 | After section 181 insert— |
| |
“Alternatively secured pensions |
| |
“181A | Minimum level of payment |
| |
(1) | The total amount of alternatively secured pension paid to a member |
| 5 |
of a registered pension scheme in each alternatively secured pension |
| |
year in respect of a money purchase arrangement under the pension |
| |
scheme must be at least 55% of the basis amount for the alternatively |
| |
secured pension year (but subject to subsection (5)). |
| |
(2) | The total amount of dependants’ alternatively secured pension paid |
| 10 |
to a dependant of a member of a registered pension scheme in each |
| |
alternatively secured pension year in respect of a money purchase |
| |
arrangement under the pension scheme must be at least 55% of the |
| |
basis amount for the alternatively secured pension year (but subject |
| |
| 15 |
(3) | If subsection (1) or (2) is not complied with in an alternatively |
| |
secured pension year in the case of any arrangement under a |
| |
registered pension scheme, the pension scheme is to be treated as |
| |
having made a scheme chargeable payment when the alternatively |
| |
secured pension year ends. |
| 20 |
(4) | The amount of the scheme chargeable payment is the difference |
| |
| |
(a) | the total amount of alternatively secured pension paid to the |
| |
member, or of the dependants’ alternatively secured pension |
| |
paid to the dependant, in respect of the arrangement in the |
| 25 |
alternatively secured pension year, and |
| |
(b) | 55% of the basis amount for the alternatively secured pension |
| |
| |
| (or, if nothing is so paid, 55% of the basis amount for the alternatively |
| |
| 30 |
(5) | Subsection (1) or (2) does not apply in relation to an alternatively |
| |
| |
(a) | it is the alternatively secured pension year ending |
| |
immediately before the death of the member or dependant, |
| |
| 35 |
(b) | in the alternatively secured pension year the member’s |
| |
alternatively secured pension fund, or the dependant’s |
| |
alternatively secured pension fund, in respect of the |
| |
arrangement is applied on pension or annuity provision (see |
| |
| 40 |
(6) | The member’s alternatively secured pension fund, or the |
| |
dependant’s alternatively secured pension fund, in respect of the |
| |
arrangement is applied on pension or annuity provision if all of the |
| |
sums and assets representing it are applied in one or more of the |
| |
| 45 |
(a) | towards the provision of a scheme pension or dependants’ |
| |
| |
|
| |
|
| |
|
(b) | to purchase a scheme pension or dependants’ scheme |
| |
| |
(c) | to purchase a lifetime annuity or dependants’ annuity. |
| |
(7) | Part 1 of Schedule 28 gives the meaning of expressions used in this |
| |
section so far as it relates to alternatively secured pension; and Part 2 |
| 5 |
of that Schedule gives the meaning of expressions used in this section |
| |
so far as it relates to dependants’ alternatively secured pension.” |
| |
15 | In section 241(1) (scheme chargeable payment), after paragraph (a) insert— |
| |
“(aa) | a scheme chargeable payment which the pension scheme is to |
| |
be treated as having made by section 181A (minimum |
| 10 |
alternatively secured pension etc), and”. |
| |
Charity lump sum death benefit |
| |
16 (1) | Paragraph 18 of Schedule 29 (charity lump sum death benefit) is amended as |
| |
| |
(2) | In sub-paragraph (1)(c), for “income withdrawal to which the member was |
| 15 |
entitled” substitute “the member’s alternatively secured pension fund (or |
| |
what would be the member’s alternatively secured pension fund but for |
| |
paragraph 11(6) and (7) of Schedule 28)”. |
| |
(3) | In sub-paragraph (1)(d), insert at the end “(or, if the member made no |
| |
nomination, selected by the scheme administrator).” |
| 20 |
(4) | In sub-paragraph (2)(d), for “dependants’ income withdrawal to which the |
| |
member was entitled” substitute “the dependant’s alternatively secured |
| |
| |
(5) | In sub-paragraph (2)(e), for “(or, if the member made no nomination, by the |
| |
dependant).” substitute “or, if the member made no nomination, by the |
| 25 |
dependant (or, if neither the member nor the dependant made a nomination, |
| |
selected by the scheme administrator).” |
| |
(6) | In sub-paragraph (4), after “representing” insert “what is (or but for |
| |
paragraph 11(6) and (7) of Schedule 28 would be)”. |
| |
Discharge of liability to scheme chargeable payment |
| 30 |
17 | In section 268(6) (unauthorised payments surcharge and scheme chargeable |
| |
payments), for “(assignment)” substitute “, 172A, 172B, 172BA, 172C or 172D |
| |
or arises under section 181A”. |
| |
| |
18 (1) | Schedule 34 (non-UK schemes application of certain charges) is amended as |
| 35 |
| |
(2) | In paragraph 1(6), omit the words from “but also” to the end. |
| |
(3) | In paragraph 4(3), omit the words from “but also” to the end. |
| |
|
| |
|
| |
|
(4) | After paragraph 7 insert— |
| |
“Unauthorised payment charge: alternatively secured pension etc |
| |
7ZA | The Commissions for Her Majesty’s Revenue and Customs may |
| |
by regulations make provision for— |
| |
(a) | a relieved member of a relevant non-UK scheme, or |
| 5 |
(b) | a transfer member of such a scheme, |
| |
| to be liable to the unauthorised payment charge in circumstances |
| |
which are the same as or similar to those in which the scheme |
| |
administrator of such a scheme is liable to the scheme sanction |
| |
charge by virtue of section 181A (minimum alternatively and |
| 10 |
dependants’ alternatively secured pension).” |
| |
| |
19 | IHTA 1984 is amended as follows. |
| |
20 (1) | Section 151A (person dying with alternatively secured pension fund) is |
| |
| 15 |
(2) | For subsection (2) substitute— |
| |
“(2) | Tax shall be charged on the relevant amount as if it were part of the |
| |
value transferred by the transfer of value made on the member’s |
| |
death at the rate or rates at which it would be charged if it formed the |
| |
highest part of that value.” |
| 20 |
(3) | In subsection (3)(a), after “death” insert “but reduced by the amount of any |
| |
previously charged income tax”. |
| |
(4) | After subsection (4) insert— |
| |
“(4A) | In subsection (3)(a) above “the amount of any previously charged |
| |
income tax” means the amount of any liability to income tax which |
| 25 |
(after the member’s death but before the time when tax is charged on |
| |
the transfer of value treated as made by the member on death) has |
| |
arisen by virtue of the making of an unauthorised member payment |
| |
under Part 4 of the Finance Act 2004 relating to the member’s |
| |
alternatively secured pension fund. |
| 30 |
(4B) | Subsection (4C) below applies where the maximum that could be |
| |
transferred by the chargeable transfer made (under section 4 above) |
| |
on the member’s death if it were to be wholly chargeable to tax at the |
| |
rate of nil per cent. exceeds— |
| |
(a) | the value actually transferred by that chargeable transfer (or |
| 35 |
nil if there is no such chargeable transfer), less |
| |
(b) | any previously untaxed alternatively secured pension fund |
| |
| |
(4C) | Where this subsection applies, tax is to be charged on the previously |
| |
untaxed alternatively secured pension fund amount as if the nil rate |
| 40 |
band maximum were—![equation: over[cross[times[char[U],char[N],char[R],char[B]],num[100.0000000000000000,"100"]],
plus[num[100.0000000000000000,"100"],minus[times[char[M],char[U],char[P],char[R]]]]]](missing.gif) |
| |
| |
|
| |
|
| |
|
UNRB is the unused nil-rate band, that is the excess mentioned |
| |
in subsection (4B) above, and |
| |
MUPR is the maximum unauthorised payment rate, that is the |
| |
maximum aggregate rate at which tax is chargeable under |
| |
Part 4 of the Finance Act 2004 in respect of an unauthorised |
| 5 |
| |
(5) | In subsection (5), at the end of the definition of “dependants’ unsecured |
| |
pension” (but before “and”) insert— |
| |
“previously untaxed alternatively secured pension fund |
| |
amount” means so much of the aggregate mentioned in |
| 10 |
subsection (3)(a) above as has not given rise to any liability to |
| |
tax by virtue of Part 4 of the Finance Act 2004 before tax is |
| |
charged on the transfer treated as made by the member on |
| |
| |
(6) | After that subsection insert— |
| 15 |
“(6) | This section applies in relation to a member who would have an |
| |
alternatively secured pension fund immediately before death but for |
| |
sub-paragraphs (6) and (7) of paragraph 11 of Schedule 28 to the |
| |
Finance Act 2004 as if those sub-paragraphs were omitted (but |
| |
| 20 |
(7) | In the case of such a member the references in subsection (3)(a) and |
| |
(b) to the member’s death are to the date on which the scheme |
| |
administrator becomes aware of the member’s death.” |
| |
21 (1) | Section 151B (relevant dependant with pension fund inherited from member |
| |
over 75) is amended as follows. |
| 25 |
(2) | In subsection (1)(b), after “before his death” insert “(or would have but for |
| |
paragraph 11(6) and (7) of Schedule 28 to the Finance Act 2004)”. |
| |
| |
22 | After that section insert— |
| |
“151BA | Rate or rates of charge under section 151B |
| 30 |
(1) | Tax charged under section 151B above shall be charged at the rate or |
| |
rates at which it would be charged on the death of the member if the |
| |
amount mentioned in subsection (3) of that section (as reduced |
| |
under subsection (4) of that section) (“the taxable amount”) had been |
| |
included in the aggregate mentioned in section 151A(3)(a) above (but |
| 35 |
| |
(2) | The rate or rates at which tax is charged on the taxable amount shall |
| |
be determined as if the taxable amount had formed the very highest |
| |
part of the value of the member’s estate immediately before the |
| |
member’s death (above any amount which is part of that value apart |
| 40 |
| |
(3) | The rate or rates at which tax is charged on the taxable amount shall |
| |
be determined on the assumptions that— |
| |
(a) | subsection (3)(b) of section 151A above were omitted, and |
| |
(b) | the references in subsections (4A) and (5) of that section to the |
| 45 |
time when tax is charged on the transfer treated as made by |
| |
|
| |
|