Taxation of Pensions Act 2014

(4) A “relevant withdrawal” is an amount paid under a relevant non-UK scheme that— (a) is paid to the person in respect of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be income withdrawal (within the meaning of paragraph 7 of Schedule 28 to FA 2004) paid to the person from the person's member's flexi-access drawdown fund in respect of the arrangement, (b) is paid to the person in respect of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be dependants' income withdrawal (within the meaning of paragraph 21 of Schedule 28 to FA 2004) paid to the person from the person's dependant's flexi-access drawdown fund in respect of the arrangement, (c) is paid to the person in respect of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be nominees' income withdrawal (within the meaning of paragraph 27D of Schedule 28 to FA 2004) paid to the person from the person's nominee's flexi-access drawdown fund in respect of the arrangement, (d) is paid to the person in respect of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be successors' income withdrawal (within the meaning of paragraph 27J of Schedule 28 to FA 2004) paid to the person from the person's successor's flexi-access drawdown fund in respect of the arrangement, (e) is a payment to the person of an annuity purchased using sums or assets held for the purposes of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be a payment of a short-term annuity (within the meaning of paragraph 6 of Schedule 28 to FA 2004) purchased using sums or assets out of the person's member's flexi-access drawdown fund in respect of the arrangement, (f) is a payment to the person of an annuity purchased using sums or assets held for the purposes of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be a payment of a dependants' short-term annuity (within the meaning of paragraph 20 of Schedule 28 to FA 2004) purchased using sums or assets out of the person's dependant's flexi-access drawdown fund in respect of the arrangement, (g) is a payment to the person of an annuity purchased using sums or assets held for the purposes of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be a payment of a nominees' short-term annuity (within the meaning of paragraph 27C of Schedule 28 to FA 2004) purchased using sums or assets out of the person's nominee's flexi-access drawdown fund in respect of the arrangement, (h) is a payment to the person of an annuity purchased using sums or assets held for the purposes of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be a payment of a successors' short-term annuity (within the meaning of paragraph 27H of Schedule 28 to FA 2004) purchased using sums or assets out of the person's successor's flexi-access drawdown fund in respect of the arrangement, (i) is paid before 6 April 2015 to the person in respect of an arrangement relating to the person under the scheme which at the time of the payment was an arrangement to which section 165(3A) or 167(2A) of FA 2004 (flexible drawdown arrangements) applied and would, if the scheme had been a registered pension scheme, have been income withdrawal or dependants' income withdrawal (within the meaning of paragraphs 7 and 21 of Schedule 28 to FA 2004), (j) is a payment to the person of an annuity purchased using sums or assets held for the purposes of an arrangement relating to the person under the scheme where— (i) the payment would, if the scheme were a registered pension scheme, be of a lifetime annuity or dependants' annuity within paragraph 3(1A) or 17(1ZA), as the case may be, of Schedule 28 to FA 2004, and (ii) the terms of the contract under which it is paid are such that there will or could be decreases in the amount of the annuity other than decreases which, if the scheme were a registered pension scheme, would be decreases from time to time allowed by regulations under paragraph 3(1)(d) or 17(1)(c), as the case may be, of Schedule 28 to FA 2004 (and any such regulations are to be treated as having effect for this purpose), or (k) is a payment to the person under a money purchase arrangement relating to the person under the scheme that, if the scheme were a registered pension scheme, would be a payment to the person of a scheme pension that the person would for the purposes of Part 4 of FA 2004 be treated as having become entitled to at a time on or after 6 April 2015 when fewer than 11 other individuals were entitled to present payment of a scheme pension under the scheme. (4A) For the purpose of determining whether the figure specified in subsection (2) is exceeded, any relevant withdrawal paid in a currency other than sterling is to be translated into sterling using the average exchange rate for the year ending with 31 March in the tax year in which the relevant withdrawal is paid.

• (4) In subsection (9)—

• (a) for the definition of “flexible drawdown arrangement” substitute—

“member's flexi-access drawdown fund” and “dependant's flexi-access drawdown fund” have the same meaning as in Part 4 of FA 2004 (see paragraphs 8A and 22A of Schedule 28 to FA 2004);

, and

• (b) after the definition of “remitted to the United Kingdom” insert—

“scheme pension” means a scheme pension within the meaning of paragraph 2 of Schedule 28 to FA 2004 or a dependants' scheme pension within the meaning of paragraphs 16 to 16C of that Schedule;

.

• (5) The amendments made by this paragraph come into force on 6 April 2015.

84

• (1) The version of section 576A which has effect if the year of departure is the tax year 2012-13 or an earlier tax year (pensions under relevant non-UK schemes: temporary non-residents) is amended as follows.

• (2) In subsection (1)—

• (a) for “non-UK income withdrawal under a relevant non-UK scheme” substitute “ withdrawal paid to a person ”,

• (b) omit paragraph (a), and

• (c) at the end insert “ , but only if the total amount of the relevant withdrawals meeting those conditions, and the relevant withdrawals (as defined by section 579CA(3A)) meeting the conditions in section 579CA(1) for the same set of years of non-residence, exceeds £100,000 ”.

• (3) In subsection (4) for “non-UK income withdrawal falling within subsection (1)” substitute “ withdrawal that meets the conditions in subsection (1)(b) and (c) ”.

• (4) After subsection (4) insert—

(4A) A “relevant withdrawal”, in relation to a person, is an amount paid under a relevant non-UK scheme that— (a) is paid to the person in respect of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be income withdrawal (within the meaning of paragraph 7 of Schedule 28 to FA 2004) paid to the person from the person's member's flexi-access drawdown fund in respect of the arrangement, (b) is paid to the person in respect of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be dependants' income withdrawal (within the meaning of paragraph 21 of Schedule 28 to FA 2004) paid to the person from the person's dependant's flexi-access drawdown fund in respect of the arrangement, (c) is paid to the person in respect of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be nominees' income withdrawal (within the meaning of paragraph 27D of Schedule 28 to FA 2004) paid to the person from the person's nominee's flexi-access drawdown fund in respect of the arrangement, (d) is paid to the person in respect of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be successors' income withdrawal (within the meaning of paragraph 27J of Schedule 28 to FA 2004) paid to the person from the person's successor's flexi-access drawdown fund in respect of the arrangement, (e) is a payment to the person of an annuity purchased using sums or assets held for the purposes of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be a payment of a short-term annuity (within the meaning of paragraph 6 of Schedule 28 to FA 2004) purchased using sums or assets out of the person's member's flexi-access drawdown fund in respect of the arrangement, (f) is a payment to the person of an annuity purchased using sums or assets held for the purposes of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be a payment of a dependants' short-term annuity (within the meaning of paragraph 20 of Schedule 28 to FA 2004) purchased using sums or assets out of the person's dependant's flexi-access drawdown fund in respect of the arrangement, (g) is a payment to the person of an annuity purchased using sums or assets held for the purposes of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be a payment of a nominees' short-term annuity (within the meaning of paragraph 27C of Schedule 28 to FA 2004) purchased using sums or assets out of the person's nominee's flexi-access drawdown fund in respect of the arrangement, (h) is a payment to the person of an annuity purchased using sums or assets held for the purposes of an arrangement relating to the person under the scheme and would, if the scheme were a registered pension scheme, be a payment of a successors' short-term annuity (within the meaning of paragraph 27H of Schedule 28 to FA 2004) purchased using sums or assets out of the person's successor's flexi-access drawdown fund in respect of the arrangement, (i) is paid before 6 April 2015 to the person in respect of an arrangement relating to the person under the scheme which at the time of the payment was an arrangement to which section 165(3A) or 167(2A) of FA 2004 (flexible drawdown arrangements) applied and would, if the scheme were a registered pension scheme, be income withdrawal or dependants' income withdrawal (within the meaning of paragraphs 7 and 21 of Schedule 28 to FA 2004), (j) is a payment to the person of an annuity purchased using sums or assets held for the purposes of an arrangement relating to the person under the scheme where— (i) the payment would, if the scheme were a registered pension scheme, be of a lifetime annuity or dependants' annuity within paragraph 3(1A) or 17(1ZA), as the case may be, of Schedule 28 to FA 2004, and (ii) the terms of the contract under which it is paid are such that there will or could be decreases in the amount of the annuity other than decreases which, if the scheme were a registered pension scheme, would be decreases from time to time allowed by regulations under paragraph 3(1)(d) or 17(1)(c), as the case may be, of Schedule 28 to FA 2004 (and any such regulations are to be treated as having effect for this purpose), or (k) is a payment to the person under a money purchase arrangement relating to the person under the scheme that, if the scheme were a registered pension scheme, would be a payment to the person of a scheme pension that the person would for the purposes of Part 4 of FA 2004 be treated as having become entitled to at a time on or after 6 April 2015 when fewer than 11 other individuals were entitled to present payment of a scheme pension under the scheme. (4B) For the purpose of determining whether the figure specified at the end of subsection (1) is exceeded, any relevant withdrawal paid in a currency other than sterling is to be translated into sterling using the average exchange rate for the year ending with 31 March in the tax year in which the relevant withdrawal is paid.

• (5) In each of subsections (5) to (7) omit “non-UK income”.

• (6) In subsection (8)—

• (a) for the definition of “flexible drawdown arrangement” substitute—

“member's flexi-access drawdown fund” and “dependant's flexi-access drawdown fund” have the same meaning as in Part 4 of FA 2004 (see paragraphs 8A and 22A of Schedule 28 to FA 2004);

,

• (b) omit the definition of “relevant non-UK income withdrawal”, and

• (c) before the definition of “year of non-residence” insert—

“scheme pension” means a scheme pension within the meaning of paragraph 2 of Schedule 28 to FA 2004 or a dependants' scheme pension within the meaning of paragraphs 16 to 16C of that Schedule;

.

• (7) The amendments made by this paragraph come into force on 6 April 2015.

Regulations about the effects of certain authorised payments

85

In section 164 of FA 2004 (authorised payments) after subsection (2) insert—

(3) The Commissioners for Her Majesty's Revenue and Customs may by regulations make provision— (a) having the effect that the making of a prescribed authorised payment does not (directly or indirectly) result in an individual first flexibly accessing pension rights for the purposes of sections 227B to 227F, (b) having the effect that the making of a prescribed authorised payment is not a relevant withdrawal for the purposes of section 579CA of ITEPA 2003, and (c) having the effect that the making of a prescribed payment by a pension scheme that is not a registered pension scheme, where the payment would be an authorised payment if the scheme were a registered pension scheme, is not a relevant withdrawal for the purposes of section 576A of ITEPA 2003. (4) In subsection (3)— - “authorised payment” means a payment specified in subsection (1), and - “prescribed” means prescribed in regulations under subsection (3).

Part 6 — Provision of information

86

The Registered Pension Schemes (Provision of Information) Regulations 2006 (S.I. 2006/567) are amended as follows.

87

After regulation 14 insert—

(14ZA) (1) If a relevant event (see paragraph (2)) occurs in relation to a member of a registered pension scheme, the scheme administrator— (a) must provide the member with a statement— (i) stating the date of the relevant event, and (ii) explaining the matters specified in paragraph (3), and (b) must do so before the end of the 31 days beginning with the date of the relevant event, but this is subject to paragraph (4). (2) For the purposes of this regulation— (a) if— (i) the member has a member's flexi-access drawdown fund in respect of an arrangement under the scheme, and (ii) the fund came into being as a result of sums or assets being designated on or after 6 April 2015 as available for the payment of drawdown pension, or as a result of the operation of paragraph 8D(2) of Schedule 28, a relevant event occurs when a qualifying payment is made to the member from the fund, (b) if— (i) the member has a member's drawdown pension fund in respect of an arrangement under the scheme, and (ii) the sums and assets that make up the fund become newly-designated funds by the operation of paragraph 8B of Schedule 28, a relevant event occurs when a qualifying payment is made to the member from the member's flexi-access drawdown fund in respect of the arrangement, (c) a relevant event occurs when an uncrystallised funds pension lump sum is paid to the member by the scheme, (d) if the member is entitled to payment of a lifetime annuity under a flexible annuity contract as defined by section 227G(8), a relevant event occurs when the first payment of the annuity is made, (e) if— (i) the member is entitled to payment of a scheme pension under a money purchase arrangement under the scheme, (ii) the member became entitled to the scheme pension on or after 6 April 2015, (iii) the member became entitled to the scheme pension at a time when fewer than 11 other individuals were entitled to the present payment of a scheme pension, or dependants' scheme pension, under the scheme, and (iv) the scheme pension is not payable under an annuity contract treated under section 153(8) or (8A) as having become a registered pension scheme, a relevant event occurs when the first payment of the scheme pension is made, and (f) a relevant event occurs when a stand-alone lump sum is paid on or after 6 April 2015 to the member by the scheme in circumstances where article 25B(2) of the Taxation of Pension Schemes (Transitional Provisions) Order 2006 applies. (3) The matters mentioned in paragraph (1)(a)(ii) are— (a) that a relevant event has occurred in relation to the member and that, as a result, the member has flexibly accessed the member's pension rights (although may have first done so previously), (b) that if in any tax year the total of the pension inputs to money purchase arrangements, and certain hybrid arrangements, relating to the member exceeds £10,000— (i) there will be an annual allowance tax charge on the excess, and (ii) the annual allowance for pension inputs to other arrangements relating to the member will be £10,000 less than it would otherwise be, and (c) the duties under regulation 14ZB and the circumstances in which the member will have to comply with them. (4) The scheme administrator is not required to comply with paragraph (1) in relation to the relevant event if— (a) the scheme administrator has complied with paragraph (1) in respect of an earlier relevant event, or (b) the scheme administrator is, at any time before complying with paragraph (1) in relation to the relevant event, informed— (i) by the member, or (ii) by the scheme administrator of another registered pension scheme, that the member flexibly accessed pension rights at a time before the relevant event occurred. (5) In this regulation, a reference to a qualifying payment from a fund is a reference to— (a) payment of income withdrawal from the fund, or (b) payment of a short-term annuity purchased using sums or assets out of the fund, but does not include payment at a time when the whole of the fund represents rights attributable to a disqualifying pension credit. (6) In paragraph (5) “disqualifying pension credit” is to be read in accordance with paragraph 2(3) and (4) of Schedule 29. (14ZB) (1) Paragraphs (3) and (4) apply if— (a) an individual receives a statement under regulation 14ZA from the scheme administrator of a registered pension scheme (the “flexed” registered pension scheme), and (b) on the date of the relevant event concerned, or at any later time, the individual is an accruing member (see paragraph (7)) of the flexed or any other registered pension scheme. (2) In this regulation— - “the relevant 13-week period” means the period of 91 days beginning with— 1. the date of receipt if the individual is an accruing member of any registered pension scheme on any day in the period— 1. beginning with the date of the relevant event concerned, and 2. ending with the date of receipt, or 2. if not, the first day after the date of receipt when the individual is an accruing member of a registered pension scheme, and - “the intervening period” means the period— 1. beginning with the date of the relevant event concerned, and 2. ending with the first day of the relevant 13-week period. (3) The individual must before the end of the relevant 13-week period— (a) pass on a copy of the statement, or (b) otherwise give notice— (i) of receipt of the statement, and (ii) of the date of the relevant event concerned or (if applicable) of its having occurred more than 2 years before the start of the relevant 13-week period, to the scheme administrator of each other registered pension scheme of which the individual is an accruing member on any day in the intervening period; but this is subject to paragraph (6). (4) Where, in the case of a particular registered pension scheme other than the flexed scheme, the individual is not an accruing member of that other scheme on any day in the intervening period but becomes an accruing member of that other scheme on a day ( “ the activation day ”) after the last day of that period, the individual must before the end of the 91 days beginning with the activation day— (a) pass on a copy of the statement, or (b) otherwise give notice— (i) of receipt of the statement, and (ii) of the date of the relevant event concerned or (if applicable) of its having occurred more than 2 years before the activation day, to the scheme administrator of that other scheme; but this is subject to paragraphs (5) and (6). (5) Paragraph (4) does not apply in connection with the individual becoming an accruing member of any particular scheme if the individual becomes an accruing member of that scheme upon or after becoming a member of that scheme as a result of a recognised transfer after the date of the relevant event concerned. (6) Paragraph (3) or (4), as the case may be, does not require the information concerned to be provided to the scheme administrator of a particular scheme if the individual has complied with regulation 14ZD(3) or (4) or 14ZE(3) or (4), or has previously complied with paragraph (3) or (4), in relation to the scheme administrator of that scheme. (7) For the purposes of this regulation, the individual is an accruing member of a registered pension scheme on any particular day if— (a) the individual is an active member of the scheme on that day as a result of there presently being arrangements for the accrual of benefits to or in respect of the individual under a cash balance arrangement or hybrid arrangement, or (b) a relevant contribution is made under the scheme on that day. (8) For the purposes of this regulation, a relevant contribution is made under a registered pension scheme if— (a) a relievable pension contribution is paid by or on behalf of the individual under a non-cash-balance money purchase arrangement relating to the individual under the scheme, (b) a contribution is paid in respect of the individual by an employer of the individual under a non-cash-balance money purchase arrangement relating to the individual under the scheme, or (c) a contribution— (i) paid under the scheme by an employer of the individual, and (ii) paid otherwise than in respect of any individual, becomes held for the purposes of a non-cash-balance money purchase arrangement relating to the individual under the scheme; and in this paragraph “non-cash-balance money purchase arrangement” means a money purchase arrangement other than a cash balance arrangement. (14ZC) (1) Paragraph (2) applies if— (a) in connection with a member of a registered pension scheme (“the transferring scheme”), there is a recognised transfer from the transferring scheme to another registered pension scheme (“the recipient scheme”), and (b) the scheme administrator of the transferring scheme has reason to believe that the member first flexibly accessed pension rights before the transfer. (2) The scheme administrator of the transferring scheme must provide the scheme administrator of the recipient scheme with a statement— (a) stating that the scheme administrator of the transferring scheme has reason to believe that the member first flexibly accessed pension rights before the transfer, and (b) specifying the date the scheme administrator of the transferring scheme understands to be the date when the member first flexibly accessed pension rights. (3) The requirement under paragraph (2) is to be complied with before— (a) the end of the 31 days beginning with the date of the transfer, or (b) if later, the end of the 31 days beginning with the date when the scheme administrator of the transferring scheme first has reason for the belief mentioned in paragraph (1)(b). (4) References in this regulation to an individual first flexibly accessing pension rights are to be read in accordance with section 227G. (14ZD) (1) Paragraphs (3) and (4) apply if— (a) at any time before 6 April 2015, section 165(3A) applied to an arrangement relating to an individual under a registered pension scheme (the “flexed” registered pension scheme), and (b) on or after 6 April 2015, the individual is an accruing member (see paragraph (9)) of the flexed or any other registered pension scheme. (2) In this regulation “the relevant 13-week period” means the period of 91 days beginning with— (a) 6 April 2015 if on that date the individual is an accruing member of any registered pension scheme, or (b) if not, the first day after 6 April 2015 when the individual is an accruing member of a registered pension scheme. (3) The individual must, before the end of the relevant 13-week period, provide the information specified in paragraph (5) to the scheme administrator of each registered pension scheme of which the individual is an accruing member on the first day of the relevant 13-week period; but this is subject to paragraphs (6) and (8). (4) Where, in the case of a particular registered pension scheme other than the flexed scheme, the individual is not an accruing member of that other scheme on the first day of the relevant 13-week period but becomes an accruing member of that other scheme on a day ( “ the activation day ”) after the first day of that period, the individual must, before the end of the 91 days beginning with the activation day, provide the information specified in paragraph (5) to the scheme administrator of that other scheme; but this is subject to paragraphs (7) and (8). (5) The information is that, as a result of section 227G(3), the individual is treated for the purposes of sections 227B to 227F as having first flexibly accessed pension rights at the start of 6 April 2015. (6) Paragraph (3) does not require that information to be provided to the scheme administrator of a particular scheme if, immediately before 6 April 2015, section 165(3A) applied to an arrangement relating to the individual under that scheme. (7) Paragraph (4) does not require that information to be provided to the scheme administrator of a particular scheme if the individual becomes an accruing member of that scheme upon or after becoming a member of that scheme as a result of a recognised transfer made to the scheme after 6 April 2015. (8) Paragraph (3) or (4), as the case may be, does not require that information to be provided to the scheme administrator of a particular scheme if the individual has complied with regulation 14ZB(3) or (4) or 14ZE(3) or (4), or has previously complied with paragraph (3) or (4), in relation to the scheme administrator of that scheme. (9) For the purposes of this regulation, the individual is an accruing member of a registered pension scheme on any particular day if— (a) the individual is an active member of the scheme on that day as a result of there presently being arrangements for the accrual of benefits to or in respect of the individual under a cash balance arrangement or hybrid arrangement, or (b) a relevant contribution is made under the scheme on that day. (10) For the purposes of this regulation, a relevant contribution is made under a registered pension scheme if— (a) a relievable pension contribution is paid by or on behalf of the individual under a non-cash-balance money purchase arrangement relating to the individual under the scheme, (b) a contribution is paid in respect of the individual by an employer of the individual under a non-cash-balance money purchase arrangement relating to the individual under the scheme, or (c) a contribution— (i) paid under the scheme by an employer of the individual, and (ii) paid otherwise than in respect of any individual, becomes held for the purposes of a non-cash-balance money purchase arrangement relating to the individual under the scheme; and in this paragraph “non-cash-balance money purchase arrangement” means a money purchase arrangement other than a cash balance arrangement. (14ZE) (1) Paragraphs (3) and (4) apply if— (a) under paragraph 8C of Schedule 28, the drawdown pension fund in respect of an arrangement relating to an individual under a registered pension scheme (the “flexed” registered pension scheme) becomes the individual's flexi-access drawdown fund in respect of the arrangement, and (b) on the conversion date, or at any later time, the individual is an accruing member (see paragraph (7)) of the flexed or any other registered pension scheme. (2) In this regulation “the relevant 13-week period” means the period of 91 days beginning with— (a) the conversion date if on that date the individual is an accruing member of any registered pension scheme, or (b) if not, the first day after that date when the individual is an accruing member of a registered pension scheme. (3) The individual must, before the end of the relevant 13-week period, inform the scheme administrator of each other registered pension scheme of which the individual is an accruing member on the first day of the relevant 13-week period— (a) of the conversion, and (b) of the conversion date or (if applicable) of the conversion's having occurred more than 2 years before the start of the relevant 13-week period; but this is subject to paragraph (6). (4) Where, in the case of a particular registered pension scheme other than the flexed scheme, the individual is not an accruing member of that other scheme on the first day of the relevant 13-week period but becomes an accruing member of that other scheme on a day ( “ the activation day ”) after the first day of that period, the individual must, before the end of the 91 days beginning with the activation day, inform the scheme administrator of that other scheme— (a) of the conversion, and (b) of the conversion date or (if applicable) of the conversion's having occurred more than 2 years before the activation day; but this is subject to paragraphs (5) and (6). (5) Paragraph (4) does not apply in connection with the individual becoming an accruing member of any particular scheme if the individual becomes an accruing member of that scheme upon or after becoming a member of that scheme as a result of a recognised transfer after the conversion date. (6) Paragraph (3) or (4), as the case may be, does not require the information concerned to be provided to the scheme administrator of a particular scheme if the individual has complied with regulation 14ZB(3) or (4) or 14ZD(3) or (4), or has previously complied with paragraph (3) or (4), in relation to the scheme administrator of that scheme. (7) For the purposes of this regulation, the individual is an accruing member of a registered pension scheme on any particular day if— (a) the individual is an active member of the scheme on that day as a result of there presently being arrangements for the accrual of benefits to or in respect of the individual under a cash balance arrangement or hybrid arrangement, or (b) a relevant contribution is made under the scheme on that day. (8) For the purposes of this regulation, a relevant contribution is made under a registered pension scheme if— (a) a relievable pension contribution is paid by or on behalf of the individual under a non-cash-balance money purchase arrangement relating to the individual under the scheme, (b) a contribution is paid in respect of the individual by an employer of the individual under a non-cash-balance money purchase arrangement relating to the individual under the scheme, or (c) a contribution— (i) paid under the scheme by an employer of the individual, and (ii) paid otherwise than in respect of any individual, becomes held for the purposes of a non-cash-balance money purchase arrangement relating to the individual under the scheme; and in this paragraph “non-cash-balance money purchase arrangement” means a money purchase arrangement other than a cash balance arrangement.

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• (1) Regulation 14A (annual allowance: annual provision of information by scheme administrator to member) is amended as follows.

• (2) In paragraph (1) (duty to provide annual pension savings statement)—

• (a) in paragraph (b) at the beginning insert

either— (i)

,

• (b) in paragraph (b) at the end insert

or (ii) both of the conditions in paragraph (9) are met,

, and

• (c) after “containing the information” insert “ specified in paragraph (10) if the condition in sub-paragraph (b)(ii) is met but otherwise containing the information ”.

• (3) In the first sentence of paragraph (8) for “(1)” substitute “ (1)(a) ”.

• (4) After paragraph (8) insert—

(9) The conditions referred to in paragraph (1)(b)(ii) are as follows. - Condition D The scheme administrator has reason to believe that the member has first flexibly accessed pension rights for the purposes of sections 227B to 227F. - Condition E That the overall total of the following amounts is more than £10,000— 1. for each money purchase arrangement relating to the member under the scheme, the pension input amount for the relevant pension input period in respect of the arrangement, and 2. for each hybrid arrangement relating to the member under the scheme, the greater of such of input amounts A and B mentioned in section 237 as are, for the purposes of section 237, relevant input amounts for the relevant pension input period in the case of the arrangement. (10) The information is— (a) the total of— (i) the pension input amounts for the relevant pension input period in respect of each money purchase arrangement relating to the member under the scheme, and (ii) the pension input amounts for the relevant pension input period in respect of each hybrid arrangement under the scheme— (aa) that relates to the member, and (bb) for which the pension input amount for the relevant pension input period is input amount A or B mentioned in section 237, (b) the total of— (i) the pension input amounts for the relevant pension input period in respect of each defined benefits arrangement relating to the member under the scheme, and (ii) the pension input amounts for the relevant pension input period in respect of each hybrid arrangement under the scheme— (aa) that relates to the member, (bb) for which the pension input amount for the relevant pension input period is input amount C mentioned in section 237, and (cc) that is made before 14 October 2014 and has not become a hybrid arrangement (whether or not for the first time) on or after that day, (c) for each hybrid arrangement relating to the member under the scheme— (i) that is made on or after 14 October 2014 or has become a hybrid arrangement (whether or not for the first time) on or after that day, and (ii) for which the pension input amount for the relevant pension input period is input amount C mentioned in section 237, which of input amounts A, B and C mentioned in section 237 is a relevant input amount for the purposes of section 237 for the relevant pension input period in the case of the arrangement, and the amount of each of those input amounts that in the case of the arrangement is a relevant input amount for those purposes for that period, (d) the unadjusted alternative annual allowance for the relevant tax year, and the fact the member's money-purchase input sub-total for the relevant tax year will be tested against a £10,000 allowance, (e) the unadjusted alternative annual allowance for each of the three preceding tax years, and the fact that the member's money-purchase input sub-total for each of those preceding years will be tested against a £10,000 allowance or, if any of those preceding years is earlier than the tax year 2015-16, the annual allowance for each such earlier year, and (f) for each of those three preceding years, the information given in the pension savings statement for the pension input period ending in that year under, as the case may be, sub-paragraphs (a) to (c) or paragraph (2)(a). (11) If, in the case of a hybrid arrangement, input amount C mentioned in section 237— (a) is a relevant input amount for the purposes of section 237 for the relevant pension input period, and (b) is equal to— (i) input amount A or B mentioned in section 237 if that is the only other relevant input amount for the purposes of section 237 for that period, or (ii) the greater of input amounts A and B mentioned in section 237 if both are relevant input amounts for the purposes of section 237 for that period, the pension input amount in respect of the arrangement for that period is, for the purposes of paragraph (10), treated as being input amount A or B or, as the case may be, the greater of input amounts A and B (and, in either case, not input amount C). (12) In paragraph (10)(d) and (e) “the unadjusted alternative annual allowance”, in relation to a tax year, means the amount that would be the member's alternative annual allowance under section 227B(2) for that tax year if any increases under section 228A(2) (carry forward of unused allowance from preceding 3 years) are ignored.

89

In regulation 14B(1) (information mentioned in regulation 14A to be supplied by scheme administrator at member's request where no automatic duty to supply it) for “regulations 14A(2) or (7)” substitute “ regulation 14A(2), (7) or (10) ”.

90

• (1) The table in regulation 3(1) (provision of event reports by scheme administrators to HM Revenue and Customs) is amended as follows.

• (2) In column 1 of the entry for reportable event 22 (report where scheme administrator provides pension savings statement under regulation 14A(1)) after “14A(1)” insert “ containing the information specified in regulation 14A(2) ”.

• (3) After the entry for reportable event 22 insert—

23 Dual annual allowances	23 Dual annual allowances
The scheme administrator is required to provide a member with a pension savings statement under regulation 14A(1) containing the information specified in regulation 14A(10).	The tax year for which the statement is provided and the name and national insurance number of the member together with the information specified in regulation 14A(10)(a) and (b).

91

The amendments made by this Part of the Schedule—

• (a) come into force on 6 April 2015, and

• (b) are to be treated as having been made by the Commissioners for Her Majesty's Revenue and Customs under such of the powers cited in the instrument containing the Regulations as are applicable.

Part 7 — Overseas pensions

92

In section 169(4) of FA 2004 (regulations about the provision of information by scheme managers of schemes that are or have been qualifying recognised overseas pension schemes) before the “and” at the end of paragraph (b) insert—

(ba) give information of a prescribed description to the scheme manager of a QROPS or former QROPS, (bb) give information of a prescribed description to the scheme administrator of a registered pension scheme, (bc) give information of a prescribed description to a member, or former member, of the QROPS or former QROPS,

.

93

• (1) Section 251 of FA 2004 (regulations about the provision of information) is amended as follows.

• (2) In subsection (4)—

• (a) omit the “or” at the end of paragraph (a), and

• (b) after paragraph (b) insert—

(c) requiring scheme administrators of registered pension schemes to provide information of a prescribed description to scheme managers of qualifying recognised overseas pension schemes, or (d) requiring members or former members of a relevant non-UK pension scheme to provide information to the scheme administrators, or scheme managers, of registered pension schemes or other relevant non-UK pension schemes.

• (3) In subsection (6) at the end insert “ ; and “relevant non-UK scheme” has the meaning given by paragraph 1 of Schedule 34 ”.

94

In paragraph 5 of Schedule 33 to FA 2004 (conditions for scheme to be qualifying overseas pension scheme include condition that manager has undertaken to comply with prescribed benefit crystallisation information requirements) after sub-paragraph (2) insert—

(2A) In sub-paragraph (2) “information relating to events that are benefit crystallisation events”, in relation to any individuals, includes (in particular) information relating to occasions that are, or could (depending on their relative timing) be, the occasions on which the individuals first flexibly access pension rights for the purposes of sections 227B to 227F.

95

• (1) Schedule 34 to FA 2004 (application of certain tax charges to non-UK schemes) is amended as follows.

• (2) In paragraph 1(3) (list of “member payment charges”) before the “and” at the end of paragraph (d) insert—

(da) the charges under section 636A(1A) and (1B) of ITEPA 2003 (uncrystallised funds pension lump sums),

.

• (3) In paragraph 1(4)—

• (a) after “The “member payment provisions” are” insert

— (a)

, and

• (b) at the end insert

, and (b) section 636A(1A) to (1C) of ITEPA 2003.

• (4) After paragraph 5 insert—

(5A) (1) Sub-paragraph (2) applies if— (a) a payment is made (or treated by this Part as made) to or in respect of a relieved member or transfer member of a relevant non-UK scheme, and (b) there is an amount of tax under a member payment charge that would be payable in respect of the payment, or part of the payment, but for the operation of double taxation arrangements. (2) The payment or (as the case may be) that part of it— (a) is “pension” for the purposes of Chapter 4 of Part 9 of ITEPA 2003 (foreign pensions), and (b) is to be treated as included in the list, in section 576A of ITEPA 2003, of payments that are “relevant withdrawals” for the purposes of that section.

• (5) In paragraph 6 (tax under member payment charges to be reduced by foreign tax in respect of the payment concerned)—

• (a) in sub-paragraph (1) after “in consequence of paragraph 1” insert “ , or by virtue of the operation of Chapter 4 of Part 9 of ITEPA 2003 in consequence of paragraph 5A, ”, and

• (b) in sub-paragraph (2) after “in consequence of paragraph 1” insert “ or 5A ”.

• (6) In paragraph 7(2) (regulations modifying the application, in relation to relevant non-UK schemes, of the member payment provisions) after paragraph (b) insert—

(ba) contain transitional provisions and savings,

.

• (7) After paragraph 9 insert—

(9ZA) (1) For the purposes of determining the annual allowance charge in the case of an individual for a relevant tax year, a pension scheme is to be treated for the purposes of section 227G as a registered pension scheme if— (a) in relation to that tax year, or (b) in relation to any earlier tax year (whether or not a relevant tax year), the scheme is a currently-relieved non-UK pension scheme and the individual is a currently-relieved member of the scheme. (2) For the purposes of this paragraph, a tax year is a “relevant tax year” in relation to an individual if— (a) it is— (i) the first tax year in relation to which the individual is a currently-relieved member of any currently-relieved non-UK pension scheme, or (ii) if later, the tax year 2015-16, or (b) it is a tax year subsequent to the tax year identified under paragraph (a). (9ZB) (1) Sub-paragraph (2) has effect if at any particular time— (a) an individual is a transfer member of a relevant non-UK scheme, (b) the scheme is, or at any previous time has been, a qualifying recognised overseas pension scheme, and (c) the particular time is not in a tax year in relation to which the scheme is a currently-relieved non-UK pension scheme of which the individual is a currently-relieved member. (2) Section 227G applies in the individual's case as if the scheme, so far as relating to the individual's relevant transfer fund under the scheme, were a registered pension scheme at the particular time. (3) The reference in sub-paragraph (2) to the individual's relevant transfer fund under the relevant non-UK scheme is to be read in accordance with paragraph 4.

• (8) In paragraph 11 (calculating pension input amounts for certain non-UK money purchase arrangements) after sub-paragraph (2) insert—

(3) Where a calculation under section 233(1) as applied by paragraph 8 is being carried out for the purposes of section 227F(3) in respect of a period that ends at the end of a tax year (see paragraph 9 and section 227F(1)), the appropriate fraction for the purposes of sub-paragraph (1)(b) is the appropriate fraction given by sub-paragraph (2) for that tax year (even where the period in respect of which the calculation is being carried out is part only of that tax year).

• (9) In paragraphs 12(2) and 19(2) (regulations modifying the application, in relation to relevant non-UK schemes, of the annual allowance provisions and lifetime allowance provisions) before the “and” at the end of paragraph (b) insert—

(ba) contain transitional provisions and savings,

.

96

• (1) The Pension Schemes (Application of UK Provisions to Relevant Non-UK Schemes) Regulations 2006 (S.I. 2006/207) are amended as follows.

• (2) In regulation 5 (Part 4 of FA 2004 is modified in accordance with Part 3 of the Regulations) for “these Regulations” substitute “ this Part ”.

• (3) Regulation 15 (modifications of Schedule 29 to FA 2004 in its application to relevant non-UK schemes) is amended in accordance with sub-paragraphs (4) to (14).

• (4) In paragraph (2), in the inserted paragraph 1(4B), before the “and” at the end of paragraph (a) insert—

(aa) the referable portion of any previous uncrystallised funds pension lump sum paid to or in respect of the member by a recognised overseas pension scheme;

.

• (5) In paragraph (2), in the inserted paragraph 1(4C), before the “and” at the end of paragraph (a) insert—

(aa) the referable portion of any previous uncrystallised funds pension lump sum to which the member became entitled under a relevant non-UK scheme since the paragraph 15 BCE occurred;

.

• (6) In paragraph (3)(a), in the inserted definition of “RP”, after “any previous pension commencement lump sum” insert “ or previous uncrystallised funds pension lump sum ”.

• (7) In paragraph (3)(b), in the inserted paragraph 2(7ZA), after “to a pension commencement lump sum,” insert “ or to an uncrystallised funds pension lump sum, ”.

• (8) In paragraph (4)(b), in the inserted paragraph 4(6), before the “and” at the end of paragraph (a) insert—

(aa) the referable portion of any previous uncrystallised funds pension lump sum paid to or in respect of the member by a recognised overseas pension scheme;

.

• (9) In paragraph (4)(b), in the inserted paragraph 4(7), before the “and” at the end of paragraph (a) insert—

(aa) the referable portion of any earlier uncrystallised funds pension lump sum to which the member became entitled under a relevant non-UK scheme since the paragraph 15 BCE occurred;

.

• (10) After paragraph (4) insert—

(4A) In paragraph 4A (uncrystallised funds pension lump sums) after sub-paragraph (2) insert— (2A) In determining for the purposes of sub-paragraph (1)(b) whether all or part of the member's lifetime allowance is available— (a) disregard any amount treated as crystallising by virtue of a relevant BCE, and (b) the amount of the allowance available is reduced by the amount determined in accordance with sub-paragraph (2B) or (2C), as the case may require. (2B) Where benefit crystallisation event 8 has occurred, the member's lifetime allowance that is available is reduced by the aggregate of— (a) the referable portion of any previous pension commencement lump sum paid to or in respect of the member by a recognised overseas pension scheme, (b) the referable portion of any previous uncrystallised funds pension lump sum paid to or in respect of the member by a recognised overseas pension scheme, and (c) the referable portion of the amount which would have crystallised by virtue of the member becoming entitled to a pension, had the scheme paying it been a registered pension scheme and disregarding paragraph 2 of Schedule 32. (2C) Where the paragraph 15 BCE has occurred, the member's lifetime allowance that is available is reduced by the aggregate of— (a) the referable portion of any earlier pension commencement lump sum to which the member became entitled under a relevant non-UK scheme since the paragraph 15 BCE occurred, (b) the referable portion of any earlier uncrystallised funds pension lump sum to which the member became entitled under a relevant non-UK scheme since the paragraph 15 BCE occurred, and (c) in respect of any pension to which the member has become entitled since the paragraph 15 BCE occurred, the referable portion of the amount which would have crystallised by virtue of the member's becoming entitled to the pension, had the scheme paying it been a registered pension scheme and disregarding paragraph 2 of Schedule 32.

• (11) In paragraph (6), in the inserted paragraph 7(7), before the “and” at the end of paragraph (a) insert—

(aa) the referable portion of any previous uncrystallised funds pension lump sum paid to or in respect of the member by a recognised overseas pension scheme;

.

• (12) In paragraph (6), in the inserted paragraph 7(8), before the “and” at the end of paragraph (a) insert—

(aa) the referable portion of any earlier uncrystallised funds pension lump sum to which the member became entitled under a relevant non-UK scheme since the paragraph 15 BCE occurred;

.

• (13) In paragraph (7), in the inserted paragraph 10(5), before the “and” at the end of paragraph (a) insert—

(aa) the referable portion of any previous uncrystallised funds pension lump sum paid to or in respect of the member by a recognised overseas pension scheme;

.

• (14) In paragraph (7), in the inserted paragraph 10(6), before the “and” at the end of paragraph (a) insert—

(aa) the referable portion of any earlier uncrystallised funds pension lump sum to which the member became entitled under a relevant non-UK scheme since the paragraph 15 BCE occurred;

.

• (15) After Part 3 insert—

(18) Section 636A(1B) of the Income Tax (Earnings and Pensions) Act 2003 (income tax on uncrystallised funds pension lump sums under registered pension schemes: meaning of “member's available lifetime allowance”) has effect in relation to relevant non-UK schemes as if the following provisions were inserted in section 636A of that Act after subsection (1C)— (1D) In determining the member's available lifetime allowance for the purposes of subsection (1B)— (a) disregard any amount treated as crystallising by virtue of— (i) benefit crystallisation event 8 (see section 216 of, and Schedule 32 to, FA 2004), or (ii) the benefit crystallisation event treated as occurring by virtue of paragraph 15 of Schedule 34 to FA 2004 (“the paragraph 15 BCE”), and (b) the amount of the allowance available is reduced by the amount determined in accordance with subsection (1E) or (1F), as the case may require. (1E) Where benefit crystallisation event 8 has occurred, the member's available lifetime allowance is reduced by the aggregate of— (a) the referable portion of any previous pension commencement lump sum paid to or in respect of the member by a recognised overseas pension scheme, (b) the referable portion of any previous uncrystallised funds pension lump sum paid to or in respect of the member by a recognised overseas pension scheme, and (c) the referable portion of the amount which would have crystallised by virtue of the member becoming entitled to a pension, had the scheme paying it been a registered pension scheme and disregarding paragraph 2 of Schedule 32 to FA 2004; and in this subsection “referable portion” means portion referable to the member's relevant transfer fund (within the meaning given by paragraph 4 of Schedule 34 to FA 2004). (1F) Where the paragraph 15 BCE has occurred, the member's available lifetime allowance is reduced by the aggregate of— (a) the referable portion of any earlier pension commencement lump sum to which the member became entitled under a relevant non-UK scheme since the paragraph 15 BCE occurred, (b) the referable portion of any earlier uncrystallised funds pension lump sum to which the member became entitled under a relevant non-UK scheme since the paragraph 15 BCE occurred, and (c) in respect of any pension to which the member has become entitled since the paragraph 15 BCE occurred, the referable portion of the amount which would have crystallised by virtue of the member's becoming entitled to the pension, had the scheme paying it been a registered pension scheme and disregarding paragraph 2 of Schedule 32 to FA 2004; and in this subsection “referable portion” means portion referable to the member's UK tax-relieved fund (within the meaning given by paragraph 3 of Schedule 34 to FA 2004). (1G) In subsections (1E) and (1F)— - “recognised overseas pension scheme” and “pension” have the same meaning as in Part 4 of FA 2004 (see section 280(2) of FA 2004), and - “relevant non-UK scheme” has the same meaning as in Schedule 34 to FA 2004 (see paragraph 1 of that Schedule).”

• (16) The amendments made by this paragraph—

• (a) have effect in relation to lump sums paid on or after 6 April 2015, and

• (b) are to be treated as having been made by the Commissioners for Her Majesty's Revenue and Customs under such of the powers conferred on them by Schedule 34 to FA 2004 (as amended by this Schedule) as are applicable.

97

• (1) In this paragraph—

• “the 2013 Regulations” means the Registered Pension Schemes and Overseas Pension Schemes (Miscellaneous Amendments) Regulations 2013 (S.I. 2013/2259), and

• “the 2006 Regulations” means the Pension Schemes (Information Requirements for Qualifying Overseas Pension Schemes, Qualifying Recognised Overseas Pension Schemes and Corresponding Relief) Regulations 2006 (S.I. 2006/208).

• (2) In regulation 3 of the 2013 Regulations (paragraph 3(1A) of the 2006 Regulations has effect in relation to 5-year periods ending on or after 1 April 2015) for “1st April 2015” substitute “ 6 April 2016 ”.

• (3) In regulation 3(1C)(a) of the 2006 Regulations (transitional modification of the time limit in regulation 3(1A)) for “1st April 2010” substitute “ 6 April 2011 ”.

SCHEDULE 2

Part 1 — Death benefits: nominees and successors

Drawdown benefits for nominees and successors of deceased scheme members

1

FA 2004 is amended as follows.

2

• (1) Section 167 (the pension death benefit rules) is amended as follows.

• (2) In pension death benefit rule 1 (pension death benefit may be paid only to dependant of deceased member) after “dependant” insert “ , or nominee or successor, ”.

• (3) After pension death benefit rule 3 (pension death benefits which may be paid under a money purchase arrangement to a dependant) insert—

Pension death benefit rule 3A No payment of pension death benefit, other than nominees' drawdown pension in respect of a money purchase arrangement, may be made to a nominee of the member. Pension death benefit rule 3B No payment of pension death benefit, other than successors' drawdown pension in respect of a money purchase arrangement, may be made to a successor of the member.

• (4) After subsection (1) insert—

(1A) For the purposes of this Part, a person becomes entitled to dependants' income withdrawal, nominees' income withdrawal or successors' income withdrawal under a registered pension scheme whenever sums or assets held for the purposes of an arrangement under the pension scheme are designated as available for the payment of (as the case may be) dependants' drawdown pension, nominees' drawdown pension or successors' drawdown pension.

• (5) In subsection (2) (meaning of “pension death benefit”) after “see section 165)” insert “ , or a pension payable in respect of the member on the subsequent death of a dependant, nominee or successor of the member ”.

3

• (1) In Part 2 of Schedule 28 (interpretation of the pension death benefit rules) at the end insert—

(27A) (1) “Nominee of the member” means an individual— (a) nominated by the member, or (b) nominated by the scheme administrator, who is not a dependant of the member, but see sub-paragraph (2). (2) In relation to any particular benefits under an arrangement, no individual nominated by the scheme administrator counts as a nominee of the member at any time when there is— (a) a dependant of the member, or (b) an individual, or charity, nominated by the member in relation to the benefits. (3) The reference in sub-paragraph (2)(b) to being nominated in relation to particular benefits under an arrangement includes— (a) a reference to being nominated in relation to the scheme, (b) a reference to being nominated in relation to arrangements that include the arrangement, (c) a reference to being nominated in relation to the arrangement, and (d) a reference to being nominated in relation to benefits that include the particular benefits. (27B) “Nominees' drawdown pension” means— (a) a nominees' short-term annuity, or (b) nominees' income withdrawal. (27C) (1) For the purposes of this Part an annuity payable to a nominee is a nominees' short-term annuity if— (a) it is purchased by the application of sums or assets representing the whole or any part of the nominee's flexi-access drawdown fund in respect of an arrangement, (b) it is payable by an insurance company, (c) the nominee becomes entitled to it on or after 6 April 2015, and (d) it is payable for a term which does not exceed five years and ends before the nominee dies. (2) The Commissioners for Her Majesty's Revenue and Customs may by regulations make provision in relation to cases in which a nominees' short-term annuity payable to a person (“the original nominees' short-term annuity”) ceases to be payable and in consequence of that— (a) sums or assets (or both) are transferred from the insurance company to another insurance company and are applied— (i) towards the provision of another nominees' short-term annuity (a “new nominees' short-term annuity”) by the other insurance company, or (ii) otherwise, or (b) sums or assets are transferred to the relevant registered pension scheme. (3) The regulations may provide that— (a) in a case where a new nominees' short-term annuity becomes payable, the new nominees' short-term annuity is to be treated, to such extent as is prescribed by the regulations and for such of the purposes of this Part as are so prescribed, as if it were the original nominees' short-term annuity, and (b) in any other case, the relevant registered pension scheme is to be treated as making an unauthorised payment in respect of the member of an amount equal to the aggregate of the sums, and the market value of the assets, transferred. (4) For the purposes of sub-paragraphs (2) and (3) a registered pension scheme is the relevant registered pension scheme if the original nominees' short-term annuity was acquired using sums or assets held for the purposes of the pension scheme. (27D) “Nominees' income withdrawal” means an amount (other than an annuity) which the nominee is entitled to be paid from the nominee's flexi-access drawdown fund in respect of an arrangement. (27E) (1) For the purposes of this Part a nominee's flexi-access drawdown fund in respect of an arrangement consists of such of the sums or assets held for the purposes of the arrangement as are newly-designated nominee funds. (2) For the purposes of this Part sums or assets held for the purposes of an arrangement are newly-designated nominee funds if— (a) they— (i) have, at any time on or after 6 April 2015, been designated under the arrangement as available for the payment of nominees' drawdown pension, and (ii) were, immediately before being so designated, unused drawdown funds or unused uncrystallised funds, or (b) they arise, or (directly or indirectly) derive, from newly-designated nominee funds under paragraph (a) or from sums or assets which so arise or derive. (3) Sums or assets held for the purposes of an arrangement after the member's death are unused drawdown funds if— (a) immediately before the member's death, they were held for the purposes of the arrangement and represented (whether alone or with other sums or assets) the member's flexi-access drawdown fund, or drawdown pension fund, in respect of the arrangement, or (b) they arise, or (directly or indirectly) derive, from unused drawdown funds under paragraph (a) or from sums or assets which so arise or derive. (4) In the case of a cash balance arrangement, sums or assets held for the purposes of the arrangement after the member's death are unused uncrystallised funds if— (a) they represent the whole or any part of the sum that would have been available immediately before the member's death for the provision of benefits to or in respect of the member if entitlement had arisen immediately before the member's death to all benefits under the arrangement to which entitlement had not previously arisen, and (b) since the member's death they have not been designated as available for the payment of dependants' drawdown pension, not been designated as available for the payment of nominees' drawdown pension, not been applied towards the provision of a dependants' annuity and not been applied towards the provision of a dependants' scheme pension. (5) In the case of any other money purchase arrangement, sums or assets held for the purposes of the arrangement after the member's death are unused uncrystallised funds if— (a) immediately before the member's death they were held for the purposes of the arrangement and at that time— (i) were not member-designated funds, (ii) were not newly-designated funds, (iii) had not been applied towards the provision of a scheme pension, and (iv) had not been applied towards the provision of a dependants' scheme pension, or (b) they arise, or (directly or indirectly) derive, from unused uncrystallised funds under paragraph (a) or from sums or assets which so arise or derive, and since the member's death they have not been designated as available for the payment of dependants' drawdown pension, not been designated as available for the payment of nominees' drawdown pension, not been applied toward the provision of a dependants' annuity and not been applied toward the provision of a dependants' scheme pension. (27F) (1) “Successor of the member” means an individual— (a) nominated by a dependant of the member, (b) nominated by a nominee of the member, (c) nominated by a successor of the member, or (d) nominated by the scheme administrator, but see sub-paragraph (2). (2) In relation to any particular benefits under an arrangement relating to a dependant, nominee or successor of the member (“the beneficiary”) in that capacity, no individual nominated by the scheme administrator counts as a successor of the member at any time after the beneficiary's death when there is an individual, or charity, nominated by the beneficiary in relation to the benefits. (3) A reference in sub-paragraph (2) to being nominated in relation to particular benefits under an arrangement includes— (a) a reference to being nominated in relation to the scheme, (b) a reference to being nominated in relation to arrangements that include the arrangement, (c) a reference to being nominated in relation to the arrangement, and (d) a reference to being nominated in relation to benefits that include the particular benefits. (4) Where a successor of the member is an individual who is also a dependant of the member, the individual in the capacity of a successor of the member is to be treated as not also being a dependant of the member. (27G) “Successors' drawdown pension” means— (a) a successors' short-term annuity, or (b) successors' income withdrawal. (27H) (1) For the purposes of this Part an annuity payable to a successor is a successors' short-term annuity if— (a) it is purchased by the application of sums or assets representing the whole or any part of the successor's flexi-access drawdown fund in respect of an arrangement, (b) it is payable by an insurance company, (c) the successor becomes entitled to it on or after 6 April 2015, and (d) it is payable for a term which does not exceed five years and ends before the successor dies. (2) The Commissioners for Her Majesty's Revenue and Customs may by regulations make provision in relation to cases in which a successors' short-term annuity payable to a person (“the original successors' short-term annuity”) ceases to be payable and in consequence of that— (a) sums or assets (or both) are transferred from the insurance company to another insurance company and are applied— (i) towards the provision of another successors' short-term annuity (a “new successors' short-term annuity”) by the other insurance company, or (ii) otherwise, or (b) sums or assets are transferred to the relevant registered pension scheme. (3) The regulations may provide that— (a) in a case where a new successors' short-term annuity becomes payable, the new successors' short-term annuity is to be treated, to such extent as is prescribed by the regulations and for such of the purposes of this Part as are so prescribed, as if it were the original successors' short-term annuity, and (b) in any other case, the relevant registered pension scheme is to be treated as making an unauthorised payment in respect of the member of an amount equal to the aggregate of the sums, and the market value of the assets, transferred. (4) For the purposes of sub-paragraphs (2) and (3) a registered pension scheme is the relevant registered pension scheme if the original successors' short-term annuity was acquired using sums or assets held for the purposes of the pension scheme. (27J) “Successors' income withdrawal” means an amount (other than an annuity) which the successor is entitled to be paid from the successor's flexi-access drawdown fund in respect of an arrangement. (27K) (1) For the purposes of this Part a successor's flexi-access drawdown fund in respect of an arrangement consists of such of the sums or assets held for the purposes of the arrangement as are newly-designated successor funds. (2) For the purposes of this Part sums or assets held for the purposes of an arrangement are newly-designated successor funds if— (a) they— (i) have, at any time on or after 6 April 2015, been designated under the arrangement as available for the payment of successors' drawdown pension, and (ii) were, immediately before being so designated, unused drawdown funds of the same deceased dependant, nominee or successor of the member, or (b) they arise, or (directly or indirectly) derive, from newly-designated successor funds under paragraph (a) or from sums or assets which so arise or derive. (3) Sums or assets held for the purposes of an arrangement after the death of a dependant, nominee or successor (“the beneficiary”) are unused drawdown funds of the beneficiary's if— (a) immediately before the beneficiary's death, they were held for the purposes of the arrangement and represented (whether alone or with other sums or assets) the beneficiary's— (i) dependant's flexi-access drawdown fund, (ii) dependant's drawdown pension fund, (iii) nominee's flexi-access drawdown fund, or (iv) successor's flexi-access drawdown fund, in respect of the arrangement, or (b) they arise, or (directly or indirectly) derive, from unused drawdown funds of the beneficiary's under paragraph (a) or from sums or assets which so arise or derive.

• (2) The provisions inserted by sub-paragraph (1) have effect even in relation to cases where the member concerned, or any dependant concerned, dies before 6 April 2015.

Nominees and successors: further drawdown amendments

4

In section 169(1D) (regulations about transfers of drawdown funds) after paragraph (aa) (which is inserted by this Act) insert

or (ab) a nominee's flexi-access drawdown fund, or (ac) a successor's flexi-access drawdown fund,

.

5

In section 172(1)(a) (assignment of rights or benefits) after “dependant” insert “ , nominee or successor ”.

6

In section 172A(1)(a) (surrender of rights or benefits) after “dependant” insert “ , nominee or successor ”.

7

In section 172A(5) (exceptions to provisions on surrender: entitlement to benefits)—

• (a) in paragraph (b) after “dependant” insert “ , or nominee, ”,

• (b) after paragraph (b) insert—

(ba) a surrender (or agreement to surrender) by a dependant, nominee or successor of the member (“the beneficiary”) in return for the conferring, on a successor of the member, of an entitlement to benefits after the beneficiary's death,

, and

• (c) in paragraph (c) for “or dependant” substitute “ , dependant, nominee or successor ”.

8

In section 172A(5A) (further provision on surrender exceptions)—

• (a) after “dependant”, in the first place it occurs, insert “ , or nominee, ”, and

• (b) after “dependant”, in the second place it occurs, insert “ or nominee ”.

9

In section 172A after subsection (5A) insert—

(5B) Subsection (5)(ba) applies only if the entitlement is held (or is to be held) by the successor under an arrangement under the pension scheme relating to the beneficiary or successor.

10

In section 172A(7) (exceptions to provisions on surrender: prospective entitlements)—

• (a) in the opening words after “dependant” insert “ or nominee or successor ”, and

• (b) in paragraph (a) after “dependant” insert “ , or nominee or successor, ”.

11

In section 172B(2) (rights of a “relevant member”)—

• (a) in paragraph (a) after “dependant” insert “ or nominee or successor ”, and

• (b) after paragraph (aa) insert—

(ab) rights representing the nominee's flexi-access drawdown fund or successor's flexi-access drawdown fund in respect of an arrangement under the pension scheme,

.

12

In section 172B(7A) (section does not apply to certain increases in rights) before “dependant's drawdown pension fund” (in both places) insert “ nominee's flexi-access drawdown fund, successor's flexi-access drawdown fund, ”.

13

In section 182(3) (value of arrangement for purposes of borrowing limits) after paragraph (b) insert—

(ba) the amount of such of the sums and the market value of such of the assets as represent nominees' flexi-access drawdown funds in respect of the arrangement (if any), (bb) the amount of such of the sums and the market value of such of the assets as represent successors' flexi-access drawdown funds in respect of the arrangement (if any),

.

14

In section 280(2) (index of defined expressions) at the appropriate places insert—

dependant (of a member of a registered pension scheme)	paragraph 15 of Schedule 28
nominee (of a member of a registered pension scheme)	paragraph 27A of Schedule 28
---	---
nominees' drawdown pension	paragraph 27B of Schedule 28
---	---
nominee's flexi-access drawdown fund	paragraph 27E of Schedule 28
---	---
nominees' income withdrawal	paragraph 27D of Schedule 28
---	---
nominees' short-term annuity	paragraph 27C of Schedule 28
---	---
successor (of a member of a registered pension scheme)	paragraph 27F of Schedule 28
---	---
successors' drawdown pension	paragraph 27G of Schedule 28
---	---
successor's flexi-access drawdown fund	paragraph 27K of Schedule 28
---	---
successors' income withdrawal	paragraph 27J of Schedule 28
---	---
successors' short-term annuity	paragraph 27H of Schedule 28
---	---

Nomination of charities by nominees and successors of deceased scheme members

15

• (1) Paragraph 18 of Schedule 29 (charity lump sum death benefit) is amended as follows.

• (2) After sub-paragraph (2) insert—

(2A) A lump sum death benefit is also a charity lump sum death benefit if— (a) it is paid on the death of an individual who is— (i) a nominee of the member, or (ii) a successor of the member, (b) there are no dependants of the member, (c) it is paid in respect of the individual's nominee's flexi-access drawdown fund or successor's flexi-access drawdown fund at the date of the individual's death in respect of an arrangement relating to the individual in the capacity of a nominee or successor of the member, and (d) it is paid to a charity nominated by the member or, if the member made no nomination, by the individual.

• (3) In sub-paragraph (3) (cases where lump sum exceeds the permitted maximum) for “or (2)” substitute “ , (2) or (2A) ”.

• (4) In sub-paragraph (4) (meaning of “permitted maximum”) after “arrangement” insert “ , or the nominee's or successor's flexi-access drawdown fund in respect of the arrangement, ”.

Related amendments in regulations

16

• (1) Regulation 12 of the Registered Pension Schemes (Transfer of Sums and Assets) Regulations 2006 (S.I. 2006/499) (drawdown funds—recognised transfers) is amended as follows.

• (2) In the heading before “—recognised” insert “ and nominee's flexi-access drawdown fund and successor's flexi-access drawdown fund ”.

• (3) In paragraph (1) (transfer recognised only if transferred items are only items held under arrangement to which transfer made) before “member's drawdown pension fund” insert “ nominee's flexi-access drawdown fund, successor's flexi-access drawdown fund, ”.

• (4) The amendments made by this paragraph—

• (a) come into force on 6 April 2015, and

• (b) are to be treated as having been made by the Commissioners for Her Majesty's Revenue and Customs under the powers to make regulations conferred by section 169(1D) and (1E) of FA 2004 (as amended by this Schedule).

Part 2 — Lump sum death benefits

Special lump sum death benefits charge

17

• (1) Section 206 of FA 2004 (special lump sum death benefits charge) is amended as follows.

• (2) After subsection (1) insert—

(1ZA) In subsection (1) the reference to a member (and to the member's death) are to be read— (a) in relation to— (i) a drawdown pension fund lump sum death benefit under paragraph 17(2) of Schedule 29, or (ii) a flexi-access drawdown fund lump sum death benefit under paragraph 17A(2) of Schedule 29, as a reference to a dependant (and to the dependant's death), (b) in relation to a flexi-access drawdown fund lump sum death benefit under paragraph 17A(3) of Schedule 29, as a reference to a nominee (and to the nominee's death), and (c) in relation to a flexi-access drawdown fund lump sum death benefit under paragraph 17A(4) of Schedule 29, as a reference to a successor (and to the successor's death).

• (3) After subsection (1A) insert—

(1B) The special lump sum death benefits charge also arises where— (a) a lump sum death benefit is paid by a registered pension scheme in respect of a member of the scheme who had not reached the age of 75 at the date of the member's death, (b) the lump sum death benefit is— (i) a drawdown pension fund lump sum death benefit under paragraph 17(1) of Schedule 29, (ii) a flexi-access drawdown fund lump sum death benefit under paragraph 17A(1) of Schedule 29, or (iii) an uncrystallised funds lump sum death benefit, and (c) the lump sum death benefit is not paid before the end of the period of two years beginning with the earlier of the day on which the scheme administrator of the scheme first knew of the member's death and the day on which the scheme administrator could first reasonably have been expected to have known of it. (1C) The special lump sum death benefits charge also arises where— (a) a lump sum death benefit is paid by a registered pension scheme on the death of a dependant, nominee or successor of a deceased member of the scheme, (b) the dependant, nominee or successor (“the beneficiary”) had not reached the age of 75 at the date of the beneficiary's death, (c) the lump sum death benefit is— (i) a drawdown pension fund lump sum death benefit under paragraph 17(2) of Schedule 29, or (ii) a flexi-access drawdown fund lump sum death benefit under paragraph 17A(2), (3) or (4) of Schedule 29, and (d) the lump sum death benefit is not paid before the end of the period of two years beginning with the earlier of the day on which the scheme administrator of the scheme first knew of the beneficiary's death and the day on which the scheme administrator could first reasonably have been expected to have known of it.

• (4) For subsection (7) (lump sum death benefits which are not to be treated as income for tax purposes) substitute—

(7) A lump sum death benefit in respect of which income tax is charged under this section is not to be treated as income for any purpose of the Tax Acts.

• (5) In consequence of sub-paragraph (4) omit paragraph 41(5) of Schedule 16 to FA 2011.

18

In section 280(2) of FA 2004 (index of defined expressions) in the entry for “special lump sum death benefits charge” for “206(1)” substitute “ 206 ”.

Uncrystallised funds lump sum death benefit

19

• (1) In paragraph 15 of Schedule 29 to FA 2004 (uncrystallised funds lump sum death benefit)—

• (a) in sub-paragraph (1) omit the second sentence (lump sum is uncrystallised funds lump sum death benefit only if paid before end of relevant two-year period), and

• (b) omit sub-paragraph (1A) (meaning of “relevant two-year period” in the second sentence of sub-paragraph (1)).

• (2) In paragraph 16 of Schedule 32 to FA 2004 (benefit crystallisation event 7: uncrystallised funds lump sum death benefit is a “relevant lump sum death benefit”)—

• (a) in sub-paragraph (b) after “benefit” insert

, other than one— (i) paid by a registered pension scheme in respect of a member of the scheme who had not reached the age of 75 at the date of the member's death, but (ii) not paid before the end of the relevant two-year period

, and

• (b) after sub-paragraph (b) insert—

In sub-paragraph (b)(ii) “the relevant two-year period”, in relation to a member of a registered pension scheme, means the period of two years beginning with the earlier of the day on which the scheme administrator of the scheme first knew of the member's death and the day on which the scheme administrator could first reasonably have been expected to have known of it.

• (3) In section 636A of ITEPA 2003 (exemption for certain lump sums under registered pension schemes)—

• (a) in subsection (1) (lump sums on which there is no liability to income tax)—

• (i) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (ii) omit paragraph (e) and the “or” preceding it (uncrystallised funds lump sum death benefit paid in respect of member who dies under 75), and

• (b) in subsection (4)(aa) (on uncrystallised funds lump sum death benefit paid in respect of member who dies having reached 75 there is no liability to income tax other than liability under section 206 of FA 2004) omit “paid in respect of a member who had reached the age of 75 at the date of the member's death”.

• (4) In consequence of sub-paragraphs (1) and (3) omit—

• (a) paragraphs 35(2)(c) and (3) and 42(2)(c) of Schedule 16 to FA 2011, and

• (b) paragraph 28(2)(a) of Schedule 19 to FA 2007.

Commencement

20

The amendments made by paragraphs 17 and 19 apply to lump sums paid on or after 6 April 2015, and the amendment made by paragraph 18 comes into force on that day.

Part 3 — Uncrystallised rights at member's death

21

In section 216(1) of FA 2004 (benefit crystallisation events and amounts crystallised), in the table, after the entry relating to benefit crystallisation event 5B insert—

5C. The designation, on or after 6 April 2015 but before the end of the relevant two-year period, of relevant unused uncrystallised funds as available for the payment, to a dependant or nominee of the individual, of (as the case may be) dependants' flexi-access drawdown pension or nominees' flexi-access drawdown pension	The aggregate of the amount of the sums and the market value of the assets designated

22

• (1) Section 217 of FA 2004 (persons liable to lifetime allowance charge) is amended as follows.

• (2) After subsection (1) insert—

(1A) Subsection (1) is subject to subsections (2) and (2A).

• (3) In subsection (2) for “But where” substitute “ Where ”.

• (4) After subsection (2) insert—

(2A) Where the liability arises by reason of a designation mentioned in the description of benefit crystallisation event 5C, it is a liability of the dependant or nominee (as the case may be).

• (5) For subsections (3) and (4) (multiple relevant lump sum death benefits) substitute—

(3) Subsection (4) applies if— (a) two or more relevant post-death benefit crystallisation events occur in respect of an individual, and (b) tax is not chargeable on the whole of the total of the amounts crystallised by them. (4) The person liable under subsection (2) or (2A) to the lifetime allowance charge charged by reason of the occurrence of any one of the relevant post-death benefit crystallisation events is liable to such portion of the total amount of the tax payable by reason of the relevant post-death benefit crystallisation events having occurred as appears to an officer of Revenue and Customs to be just and reasonable. (4A) For the purposes of subsections (3) and (4), a benefit crystallisation event is a “relevant post-death benefit crystallisation event” if it is benefit crystallisation event 5C or 7.

• (6) The amendment made by sub-paragraph (5) comes into force on 6 April 2015.

23

• (1) Section 219 of FA 2004 (availability of individual's lifetime allowance) is amended as follows.

• (2) In subsection (7) (cases where there is more than one benefit crystallisation event 7)—

• (a) after “more than one” insert “ relevant post-death ”,

• (b) omit “by reason of the payment of lump sum death benefits”, and

• (c) for “individual the” substitute “ individual, the relevant post-death ”.

• (3) After subsection (7) insert—

(7A) For the purposes of subsection (7), a benefit crystallisation event is a “relevant post-death benefit crystallisation event” if it is benefit crystallisation event 5C or 7.

• (4) The amendments made by this paragraph come into force on 6 April 2015.

24

• (1) Schedule 32 to FA 2004 (supplementary provisions about benefit crystallisation events) is amended as follows.

• (2) In paragraph 1 (meaning of “the relevant pension schemes”: in certain cases means schemes of which the individual was a member immediately before death) before “7” insert “ 5C or ”.

• (3) After paragraph 14A insert—

(14B) For the purposes of benefit crystallisation event 5C “the relevant two-year period”, in relation to relevant unused uncrystallised funds held for the purposes of a money purchase arrangement relating to the individual under any of the relevant pension schemes, means the period of two years beginning with the earlier of the day on which the scheme administrator of the scheme first knew of the individual's death and the day on which the scheme administrator could first reasonably have been expected to have known of it. (14C) (1) For the purposes of benefit crystallisation event 5C, sums or assets held after the death of the individual for the purposes of a money purchase arrangement relating to the individual under any of the relevant pension schemes are relevant unused uncrystallised funds if— (a) they are unused uncrystallised funds, and (b) the individual had not reached the age of 75 at the date of the individual's death. (2) Paragraph 27E(4) and (5) of Schedule 28 (meaning of “unused uncrystallised funds”) apply for the purposes of sub-paragraph (1)(a), but as if references to the member were references to the individual.

Part 4 — Income tax on beneficiaries' income withdrawal

25

• (1) ITEPA 2003 is amended as follows.

• (2) In section 573 (foreign pensions to which section 573 applies) after subsection (2) insert—

(2A) This section does not apply to pension within section 574(1)(ba) if— (a) the pension is paid in respect of a deceased member of a pension scheme who had not reached the age of 75 at the date of death, and (b) no pension payments to the person entitled to the pension were made before 6 April 2015 in respect of the deceased member out of any of the following— (i) the fund from which the pension is paid, and (ii) any fund represented (to any extent) by that fund. (2B) This section does not apply to pension within section 574(1)(bb) if the pension is paid in respect of a deceased individual who had not reached the age of 75 at the date of death. (2C) Subsection (2A) is subject to subsection (2D). (2D) This section does apply to pension within section 574(1)(ba) paid in respect of a deceased member of a pension scheme who had not reached the age of 75 at the date of death if the pension is paid in respect of sums or assets held for the purposes of the pension scheme under which the pension is paid (“the paying scheme”) that would, if the paying scheme were a registered pension scheme, be sums or assets— (a) representing unused uncrystallised funds (within the meaning of paragraph 27E(4) and (5) of Schedule 28 to FA 2004) in the deceased member's case, and (b) designated on or after 6 April 2015 as available for the payment of dependants' drawdown pension or nominees' drawdown pension, but (c) not so designated before the end of the period of two years beginning with the earlier of the day on which the scheme manager of the paying scheme first knew of the member's death and the day on which the scheme manager could first reasonably have been expected to have known of it.

• (3) In section 574(1) (foreign pensions: meaning of “pension”)—

• (a) in paragraph (b) (“pension” includes amounts corresponding to income withdrawal or dependants' income withdrawal)—

• (i) omit “or dependants' income withdrawal”, and

• (ii) for “paragraphs 7 and 21” substitute “ paragraph 7 ”, and

• (b) before the “and” at the end of paragraph (b) insert—

(ba) an amount paid under a relevant non-UK scheme or an overseas pension scheme which, if the scheme were a registered pension scheme, would be dependants' income withdrawal or nominees' income withdrawal (within the meaning of paragraphs 21 and 27D of Schedule 28 to FA 2004), (bb) an amount paid under a relevant non-UK scheme or an overseas pension scheme which, if the scheme were a registered pension scheme, would be successors' income withdrawal (within the meaning of paragraph 27J of Schedule 28 to FA 2004),

.

• (4) In section 579A(1) (section applies to pensions under registered pension schemes, subject to subsection (2)) after “subsection (2)” insert “ and section 579CZA ”.

• (5) After section 579C insert—