Pensions Tax and Regulation

Valuable information on the tax regime and regulations applying to pension arrangements

The 2006 pensions tax regime

On 6 April 2006, the pensions tax regime governing pension schemes came into force. This section explains to you the tax rules now in force for registered pension schemes including details of:

• payments made by registered pension schemes
• tax relief for employer and member contribution
• taxation of benefits
• lifetime and annual allowances
• transitional arrangements.

The Pensions Regulator

The Pensions Regulator came into being on 6 April 2005, taking over the functions previously conferred on the Occupational Pensions Regulatory Authority. This section gives you details of the Regulator’s role, including details of:

• financial support directions
• employers’ and trustees’ duty to report breaches of the law
• codes of practice and guidance
• civil penalties
• register of pension schemes.

The Pension Protection Fund

Defined benefit pension schemes that could qualify for entering the Pension Protection Fund are charged levies to support it. This section enables you to clearly understand the PPF by explaining the role and including details of:

• what constitutes an insolvency event for employers
• the assessment periods for a scheme entering the PPF
• the effect of the PPF assuming responsibility for a scheme
• fraud compensation provisions.

The Financial Services Authority

The Financial Services Authority is an independent non-governmental body that regulates the financial services industry in the UK, therefore, it has some responsibilities in relation to personal pensions, stakeholder schemes and occupational pension schemes. This section looks at:

• who needs FSA authorisation
• giving advice on GPPs and stakeholder schemes
• how the FSA works with the Pensions Regulator.

Data protection

This section gives you details on how data protecting legislation applies to pension schemes and includes information on:

• the Data Protection Act
• data definitions
• data protection principles
• the significance for pension schemes and employers.

Dispute resolution

Many different types of dispute can arise between the parties to a pension arrangement, and there are various procedures in place to help cope with these disputes. This chapter gives you information on the options, including:

• internal complaints procedures offered by the scheme
• the Pensions Advisory Service, the Pensions Ombudsman and the Financial Ombudsman Service
• employment tribunals and the courts.