The Chancellor delivered the Budget on 21 March 2012, which confirmed changes to the pensions tax regime and state pension reform.
A transfer to an overseas pension scheme must meet certain conditions otherwise HMRC will treat the transfer as an unauthorised payment with resulting tax charges on both the transferring scheme and the member. These conditions will be amended from 6 April 2012 as HMRC looks to tighten up on the use of overseas schemes for tax avoidance purposes.
HMRC has issued an announcement to clarify its interpretation of the tax rules for benefit accrual for those individuals with fixed protection in relation to lump sum death benefits and benefit accrual.
The earnings thresholds for automatic enrolment have been confirmed for 2012/13. In addition, a consultation has been published on the proposed dates for when small and medium employers will have to comply with their automatic enrolment duties as well as a proposal to extend the first transitional period for phasing in contributions
The Government has recently published a response to the consultation on changes to contracting-out legislation which confirms that trustees are able to amend the scheme rules by resolution to remove provisions relating to protected rights. An increase to the fixed rate revaluation percentage for GMPs has also been confirmed.
HMRC has issued the sixth and final issue of its Countdown Bulletin, covering the abolition of contracting-out on a defined contribution basis. †The edition includes issues surrounding Contracted-Out Mixed Benefit schemes, HMRCís position on payment and recovery of Minimum Contributions / Age Related Rebates, and the interaction of other legislation with contracted-out rights.
HMRC has published its Newsletter 52 focussing on Fixed Protection and the effect of Pension Increase Exchange exercises on Benefit Crystallisation Event (BCE) 3. The newsletter also contains information about appealing against a penalty for late/non-submission of the Registered Pension Scheme Return and SA970, and updates on auto enrolment and the RAS project.