Personal Pension Schemes Guidance Notes

1 IR76 (2000). Personal Pension Schemes Guidance Notes (Including Stakeholder Pension Schemes ). Issued by Inland Revenue SPSS (Nottingham). an Executive Office of the Inland Revenue Inland Revenue SPSS (Nottingham). Yorke House PO Box 62. Castle Meadow Road Nottingham NG2 1BG. Tel. 0115 974 1777. Fax. 0115 974 1480. These Notes should be read in conjunction with " Inland Revenue SPSS. (Nottingham) Updates", which periodically amend or expand upon them. Crown Copyright 2000. The text of this document may be freely reproduced provided the source is acknowledged Contents Introductory Notes Part 1 : Introduction Part 2 : Establishment of Schemes Part 3 : Eligibility Part 4 : Contributions Part 5A : Method of Giving Tax Relief on Contributions - up to 5 April 2001.

2 Part 5B : Method of Giving Tax Relief on Contributions - from 6 April 2001. Part 6A : Carry Back of Contributions - up to 5 April 2001. Part 6B : Carry Back of Contributions - from 6 April 2001. Part 7A : Carry Forward of Unused Relief - up to 5 April 2001. Part 7B : Carry Forward of Unused Relief - from 6 April 2001. Part 8 : Commencement of Benefits Part 9 : Member's Benefits Part 10 : Death Benefits Part 11 : Personal Pension Scheme Investments Including Self-Invested Personal Pensions (SIPPs). Part 12: Transfers from 6 April 2001. Part 13: Application for Tax Approval Part 14A : Scheme Administration - up to 5 April 2001. Part 14B : Scheme Administration - from 6 April 2001. Part 15A : Tax Repayment Claims by Scheme Administrators - contributions before 6 April 2001.

3 Part 15B : Tax Repayment Claims by Scheme Administrators - contributions after 5 April 2001. Part 16 : The Inland Revenue Inspection Part 17A : Returns of Information - up to 5 April 2001. Part 17B : Returns of Information - from 6 April 2001. Part 18 : Refunds of Contributions Part 19 : Tax Treatment of Approved Schemes Part 20 : Discontinuance of Schemes Part 21 : Withdrawal of Tax Approval Part 22A: Contracting out of the State Second Pension : Appropriate Personal Pension Stakeholder Pension Schemes Part 22B: Contracting out of the State Second Pension : Contracted-out Money Purchase Stakeholder Pension Schemes Part 23 : Conversion of Chapter I Scheme to Chapter IV Scheme Part 24 : Registration of Stakeholder Pension Schemes with Opra Appendix 1 : Glossary Appendix 2 : Relevant Earnings Appendix 3 : Non Relevant Earnings Appendix 4 (withdrawn).

4 Appendix 5 (withdrawn). Appendix 6 : CPC. Appendix 7 (withdrawn). Appendix 8 (withdrawn). Appendix 8A (withdrawn). Appendix 8B (withdrawn). Appendix 8C (withdrawn). Appendix 8D (withdrawn). Appendix 8E (withdrawn). Appendix 9 : Connected Persons Appendix 10 : Early Pension Ages Appendix 11 : Cap Concurrent Employments Appendix 12 : Interaction of Retirement Annuity Relief & Personal Pension Relief Appendix 13 : Form PP10 (not to be used after 5 April 2001). Appendix 14 : Form PP 14. Appendix 15 (withdrawn). Appendix 16 (withdrawn). Appendix 17 : Form PP 43 (not to be used after 5 April 2001). Appendix 18 : Audit and Audit Objectives Appendix 19 : Member's Application Checklist Appendix 20: Checklist for transfer-in application form Appendix 21 : Appeals against contracting-out decisions on Stakeholder Pension Schemes Appendix 22 : Transfers from Personal Pension Schemes to Overseas Schemes Appendix 23 : Checklist for transfers in drawdown Appendix 24.

5 Appendix 25. Appendix 26 : SIB Review of Transfers and Opt Outs : Provision of Redress For Mis-Selling Index Introductory Notes Note 1 - Occasional Pensions Updates are used to amplify or amend this manual. Where such amendments are announced, substantive changes can be identified in the text by background shading or high-lighting. Revised headings are not normally highlighted. This highlighting is removed when a new set of amendments is announced. However, where a change consists of a large addition (such as a new appendix) and the Update clearly indicates that the entire section is new, the new content may at times be introduced without highlighting in the interests of legibility. Part 1 : Introduction The legislation governing the tax treatment of Personal Pension Schemes is contained in Chapter IV Part XIV of the Income and Corporation Taxes Act 1988 as amended by subsequent Finance Acts.

6 These Guidance Notes describe the practice of the Inland Revenue in approving Schemes under that legislation. They also describe the tax consequences of approval. Stakeholder Pension Schemes are a new type of low-cost Personal Pension scheme, which may accept contributions from 6 April 2001. Chapter IV Part XIV ICTA 1988 has been amended to give effect to the changes. The changes generally apply to all Personal Pension Schemes , but existing conditions continue to apply in some cases to contracts which came into existence prior to 6 April 2001. In this publication, unless otherwise stated, all references to Personal Pension Schemes include stakeholder Pension Schemes . Where special rules or requirements relate to stakeholder Pension Schemes only, separate Guidance is included for both stakeholder and non-stakeholder Personal Pension Schemes .

7 Inland Revenue (Savings, Pensions, Share Schemes )'s Nottingham office is responsible for the approval of Schemes (Inland Revenue SPSS (Nottingham)). Their address is: Yorke House PO Box 62. Castle Meadow Road Nottingham NG2 1BG. The Customer Helpline number is - 0115 974 1777. These Notes also provide general Guidance for Personal Pension scheme administrators on how to deal with the tax relief on payments made to Personal Pension Schemes (Parts 14 - 17 and all the examples in Parts 6 & 7) and refunds of contributions (Part 18). The Inland Revenue (Savings, Pensions, Share Schemes )'s Bootle office is responsible for these areas (Inland Revenue SPSS (Bootle)). Their address is: St John's House Merton Road Bootle Merseyside L69 9BB.

8 The telephone and fax numbers are Telephone Fax Claims to repayment 0151 472 6109 0151 472 6003. 6110. 6162. 6176. General Advice 0151 472 6159 0151 472 6003. 6171. 6173. 6337. Returns of Information 0151 472 6123 0151 472 6124. Technical advice 0151 472 6022. Stationery supplies 0151 472 6007. Audit issues are dealt with separately by Inland Revenue (Savings, Pensions, Share Schemes )'s Worthing Office. Their address is: Room 34. East Block Barrington Road Worthing West Sussex BN12 4SE. The telephone and fax numbers are: Telephone Fax 01903 509963 01903 509885. Parts 22A and 22B contain Guidance on contracting out of the additional state Pension (which is now commonly known as the State Second Pension but which was known prior to 6 April 2002.)

9 As the State Earnings-related Pension Scheme or SERPS) for stakeholder Pension Schemes . The Guidance in Part 22A relates to an Appropriate Personal Pension stakeholder Pension scheme and Part 22B relates to a Contracted-out Money Purchase stakeholder Pension scheme). Inland Revenue SPSS (Nottingham) is responsible for these areas where stakeholder Pension Schemes are concerned. Contracting-out for non-stakeholder Personal Pension Schemes remains the responsibility of Inland Revenue National Insurance Services to Pensions Industry, formerly COEG (the Contracted-out Employments Group) at the National Insurance Contributions Office. For Guidance on contracting out for non-stakeholder Schemes or employers, please see the following manuals (some of which are on the Inland Revenue website).

10 CA 14A Termination of Contracted-out Employment Manual for Money Purchase Pension Schemes and Money Purchase Parts of Mixed-Benefit Schemes CA 14D Contracted-out Guidance for Money Purchase Pension Schemes and Money Purchase Overseas Schemes CA 15 Cessation of Contracted-out Pension Schemes CA 16 Appropriate Personal Pension Scheme Manual Procedural Guidance CA 16A Appropriate Personal Pension Scheme Manual Guidance for Scheme Managers Printed copies can be obtained from Inland Revenue National Insurance Contributions Office OSG Stationery (Services to Pensions Industry). Benton Park View Newcastle upon Tyne NE98 1ZZ. Telephone number 0191 225 3361. Fax number 0191 225 3227. Part 24 provides information about the Occupational Pensions Regulatory Authority (Opra).