PENSIONS – SIMPLIFIED TAX REGIME
Synopsis: It’s that time of year again when scheme members’ can expect to receive a statement from their pension scheme(s) if the total pension input amount to that scheme is greater than the annual allowance.
Date posted: Tuesday, September 30, 2014
Pension Scheme administrators must automatically give a Pensions Savings Statement (PSS) to pension scheme members who have a total pension input amount (PIA) greater than the annual allowance in the tax year in which the pension input period (PIP) ends. This statement must be issued to the member by 6 October following the end of the tax year.
So pension savings statements will be issued where PIPs ending between 6 April 2013 and 5 April 2014 and the PIA exceeds £50,000, the annual allowance for 2013/14.
The Statements must contain all of the following details:
• The total of the PIAs for the member for all their arrangements under the scheme for all PIPs ending in the tax year in question.
• The amount of the annual allowance for the tax year concerned.
• The total of the PIA for the member for all their arrangements under the scheme for all PIPs ending the previous three tax years.
• The amount of the annual allowance, or deemed annual allowance where that applies, for the previous three tax years.
As you might expect, HMRC can impose penalties for PSS that
• Are issued late
• Contain incorrect information
Failure on the part of a scheme administrator to issue a statement within the deadline may result in a fine of up to £300 for each PSS that are not issued in time. If the scheme administrator has still not provided the PSS after the initial HMRC penalty has been raised, further penalties can be raised. These further penalties are up to £60 for each day that the PSS has not been provided.
Penalties can be issued for supplying incorrect information on the PSS. If the scheme administrator has negligently or fraudulently provided incorrect information they can be liable to a penalty of up to £3,000.
The scheme administrator may have given incorrect information because they were given wrong information from a third party. If this is the case then, unless it is obvious the information given to the scheme administrator was wrong, no penalty will be due.
Reporting to HMRC
For PIPs ending in the tax year 2013/14 and subsequent tax years, the scheme administrator must make an event report to HMRC when the scheme administrator has provided a PSS to a scheme member.
The event report must contain all of the following information:
• the tax year for which the annual allowance was exceeded
• the name and national insurance number of the member, and
• for the tax year concerned, the total of the pension input amounts for the member for all their arrangements under the scheme.
The event report must be made for the tax year in which the pension savings statement is actually issued to the member. The event report is, therefore, likely to be for a later tax year than the tax year for which the pension savings statement relates.
Why not talk to the professionals about properly managing your finances
Call us on 01273 457100 020 7871 5387 01403 333666
Or email us on email@example.com
Or just take a look at how we help our clients www.opusgold.com