Source: http://www.legislation.gov.uk/ukpga/2004/12/part/4/enacted
Timestamp: 2015-04-26 13:18:43
Document Index: 691534964

Matched Legal Cases: ['art 4', 'art 4', 'art 4', 'art 1', 'art 4', 'arts 3']

Skip to main contentSkip to navigationlegislation.gov.ukThe National ArchivesHelpSite MapAccessibilityContact UsCymraegHomeAbout UsBrowse LegislationNew LegislationChanges To LegislationSearch LegislationSearch LegislationTitle: (or keywords in the title)Year:Number:Type:All Legislation (excluding draft)All Primary Legislation UK Public General Acts UK Local Acts Acts of the Scottish Parliament Acts of the National Assembly for Wales Measures of the National Assembly for Wales Church Measures Acts of the Northern Ireland Assembly Acts of the Old Scottish Parliament Acts of the English Parliament Acts of the Old Irish Parliament Acts of the Parliament of Great Britain Northern Ireland Orders in Council Measures of the Northern Ireland Assembly Acts of the Northern Ireland ParliamentAll Secondary Legislation UK Statutory Instruments Wales Statutory Instruments Scottish Statutory Instruments Northern Ireland Statutory Rules Church Instruments UK Ministerial Orders UK Statutory Rules and OrdersAll Draft Legislation UK Draft Statutory Instruments Scottish Draft Statutory Instruments Northern Ireland Draft Statutory RulesAll Impact Assessments UK Impact AssessmentsSearchAdvanced SearchFinance Act 2004You are here:2004 c. 12Part 4Table of ContentsContentMore ResourcesPrevious: PartNext: PartPlain ViewPrint OptionsWhat VersionLatest available (Revised)Original (As enacted)Opening OptionsOpen whole ActOpen Act without schedulesOpen Schedules onlyMore ResourcesOriginal Print PDFCorrection Slip - 15/08/2011View moreStatus:This is the original version (as it was originally enacted).Part 4Pension schemes etcChapter 1IntroductionIntroductory149Overview of Part 4(1)This Part contains tax provision about pension schemes and other similar schemes.
Main concepts150Meaning of “pension scheme”(1)In this Part “pension scheme” means a scheme or other arrangements, comprised in one or more instruments or agreements, having or capable of having effect so as to provide benefits to or in respect of persons—
151Meaning of “member”(1)In this Part “member” in relation to a pension scheme, means any active member, pensioner member, deferred member or pension credit member of the pension scheme.
(2)For the purposes of this Part a person is an active member of a pension scheme if there are presently arrangements made under the pension scheme for the accrual of benefits to or in respect of the person.
(3)For the purposes of this Part a person is a pensioner member of a pension scheme if the person is entitled to the present payment of benefits under the pension scheme and is not an active member.
(4)A person is a deferred member of a pension scheme if the person has accrued rights under the pension scheme and is neither an active member nor a pensioner member.
(5)A person is a pension credit member of a pension scheme if the person has rights under the pension scheme which are attributable (directly or indirectly) to pension credits.
152Meaning of “arrangement”(1)In this Part “arrangement”, in relation to a member of a pension scheme, means an arrangement relating to the member under the pension scheme.
(2)For the purposes of this Part an arrangement is a “money purchase arrangement” at any time if, at that time, all the benefits that may be provided to or in respect of the member under the arrangement are cash balance benefits or other money purchase benefits.
(3)For the purposes of this Part a money purchase arrangement is a “cash balance arrangement” at any time if, at that time, all the benefits that may be provided to or in respect of the member under the arrangement are cash balance benefits.
(4)In this Part “money purchase benefits”, in relation to a member of a pension scheme, means benefits the rate or amount of which is calculated by reference to an amount available for the provision of benefits to or in respect of the member (whether the amount so available is calculated by reference to payments made under the pension scheme by the member or any other person in respect of the member or any other factor).
(5)In this Part “cash balance benefits” means benefits the rate or amount of which is calculated by reference to an amount available for the provision of benefits to or in respect of the member calculated otherwise than wholly by reference to payments made under the arrangement by the member or by any other person in respect of the member (or transfers or other credits).
(6)For the purposes of this Part an arrangement is a “defined benefits arrangement” at any time if, at that time, all the benefits that may be provided to or in respect of the member under the arrangement are defined benefits.
(7)In this Part “defined benefits”, in relation to a member of a pension scheme, means benefits which are not money purchase benefits (but which are calculated by reference to earnings or service of the member or any other factor other than an amount available for their provision).
(8)For the purposes of this Part an arrangement is a “hybrid arrangement” at any time if, at that time, all of the benefits that may be provided to or in respect of the member under the arrangement are, depending on the circumstances, to be of one of any two or three of the following varieties—
(a)cash balance benefits,
(b)other money purchase benefits, and
(c)defined benefits.
(9)Where not all of the benefits that may be provided under an arrangement to or in respect of the member are of the same one of those varieties of benefits, the arrangement is to be treated for the purposes of this Part as being two or three separate arrangements one of which relates to each of the two or three varieties of benefits that may be so provided.
Chapter 2Registration of pension schemesRegistration153Registration of pension schemes(1)An application may be made to the Inland Revenue for a pension scheme to be registered.
(a)must contain any information which is reasonably required by the Inland Revenue in any form specified by the Board of Inland Revenue, and
(b)must be accompanied by a declaration that the application is made by the scheme administrator (see section 270) and any other declarations by the scheme administrator which are reasonably required by the Inland Revenue.
(3)The declarations which the Inland Revenue may require to accompany an application for the registration of a pension scheme include, in particular, a declaration that the instruments or agreements by which it is constituted do not entitle any person to unauthorised payments (see section 160(5)).
(4)On receipt of an application for a pension scheme to be registered the Inland Revenue must decide whether or not to register the pension scheme.
(5)The Inland Revenue’s decision must be to register the pension scheme unless it appears that—
(a)any information contained in the application is incorrect, or
(b)any declaration accompanying it is false.
(6)The Inland Revenue must notify the scheme administrator of the decision on the application.
(7)Unless the Inland Revenue’s decision is not to register the pension scheme, the notification must state the day on and after which the pension scheme will be a registered pension scheme.
(8)An annuity contract—
(a)by means of which benefits under a registered pension scheme have been secured, but
(b)which does not provide for the immediate payment of benefits,
is to be treated as having become a registered pension scheme on the day on which it is made.
(9)Schedule 36 contains (in Part 1) provisions treating certain pension schemes in existence immediately before 6th April 2006 as registered pension schemes (and related provisions).
154Persons by whom registered pension scheme may be established(1)An application to register a pension scheme may be made only if the pension scheme is an occupational pension scheme or has been established by—
(a)an insurance company (see section 275),
(b)a unit trust scheme manager,
(c)an operator, trustee or depositary of a recognised EEA collective investment scheme,
(d)an authorised open-ended investment company,
(e)a building society,
(f)a bank, or
(g)an EEA investment portfolio manager.
(2)But subsection (1) does not apply to a public service pension scheme.
(3)Section 155 defines terms used in subsection (1)(b) to (g).
(4)The Treasury may by order amend this section and section 155.
155Persons by whom scheme may be established: supplementary(1)This section has effect for defining terms used in section 154(1)(b) to (g).
(2)“Unit trust scheme manager” means—
(a)a person who has permission under Part 4 of FISMA 2000 to manage unit trust schemes authorised under section 243 of FISMA 2000, or
(b)a firm which has permission under paragraph 4 of Schedule 4 to FISMA 2000 (as a result of qualifying for authorisation under paragraph 2 of that Schedule: Treaty firms) to manage unit trust schemes authorised under that section.
(3)“Recognised EEA collective investment scheme” means a collective investment scheme (within the meaning given by section 235 of FISMA 2000) which is recognised by virtue of section 264 of FISMA 2000 (schemes constituted in other EEA States).
(4)“Authorised open-ended investment company” has the meaning given by section 237(3) of FISMA 2000.
(5)“Building society” means a building society within the Building Societies Act 1986 (c. 53).
(6)“Bank” means—
(a)a person falling within section 840A(1)(b) of ICTA (persons, other than building societies etc. permitted to accept deposits), or
(b)a body corporate which is a subsidiary or holding company of a person falling within section 840A(1)(b) of ICTA or is a subsidiary of the holding company of such a person.
In paragraph (b) “subsidiary” and “holding company” are to be read in accordance with section 736 of the Companies Act 1985 (c. 6) or Article 4 of the Companies (Northern Ireland) Order 1986 (S.I. 1986/1032 (N.I. 6)).
(7)“EEA investment portfolio manager” means an institution which—
(a)is an EEA firm of the kind mentioned in paragraph 5(a), (b) or (c) of Schedule 3 to FISMA 2000 (certain credit and financial institutions),
(b)qualifies for authorisation under paragraph 12(1) or (2) of that Schedule, and
(c)has permission under FISMA 2000 to manage portfolios of investments.
156Appeal against decision not to register(1)This section applies where, on an application for a pension scheme to be registered, the Inland Revenue’s decision is not to register the pension scheme.
(2)The scheme administrator may appeal against the decision.
(3)The appeal is to the General Commissioners, except that the scheme administrator may elect (in accordance with section 46(1) of TMA 1970) to bring the appeal before the Special Commissioners instead of the General Commissioners.
(5)An appeal under this section against a decision must be brought within the period of 30 days beginning with the day on which the scheme administrator was notified of the decision.
(6)The Commissioners before whom an appeal under this section is brought must consider whether the pension scheme ought to have been registered by the Inland Revenue.
(7)If they decide that the pension scheme ought not to have been registered by the Inland Revenue, they must dismiss the appeal.
(8)If they decide that the pension scheme ought to have been registered by the Inland Revenue, the pension scheme is to be treated as having been registered on such date as the Commissioners determine (but subject to any further appeal or any determination on, or in consequence of, a case stated).
De-registration157De-registration(1)The Inland Revenue may withdraw the registration of a pension scheme.
(2)If the Inland Revenue withdraws the registration of a pension scheme the Inland Revenue must notify the scheme administrator.
(3)If there is no-one who is the scheme administrator, the Inland Revenue must instead notify any person or persons—
(a)who has or have responsibility for the discharge of any obligation relating to the pension scheme under section 271(4) (continuation of liability where no scheme administrator), section 272 (trustees etc.) or section 273 (members), and
(b)whom it is reasonably practicable for the Inland Revenue to identify.
(4)The notification must state the date on and after which the pension scheme will not be a registered pension scheme.
158Grounds for de-registration(1)The registration of a pension scheme may be withdrawn under section 157 only if it appears to the Inland Revenue—
(a)that the amount of the scheme chargeable payments (see section 241) made by the pension scheme during any period of 12 months exceeds the de-registration threshold,
(b)that the scheme administrator fails to pay a substantial amount of tax (or interest on tax) due from the scheme administrator by virtue of this Part,
(c)that the scheme administrator fails to provide information required to be provided to the Inland Revenue by virtue of this Part and the failure is significant,
(d)that any information contained in the application to register the pension scheme or otherwise provided to the Inland Revenue is incorrect in a material particular,
(e)that any declaration accompanying that application or the provision of other information to the Inland Revenue is false in a material particular, or
(f)that there is no scheme administrator.
(2)The amount of the scheme chargeable payments made by a pension scheme during any period of 12 months exceeds the de-registration threshold if the scheme chargeable payments percentage is 25% or more.
(3)The scheme chargeable payments percentage is—
(a)if only one scheme chargeable payment is made during the period of 12 months, the percentage of the pension fund used up on the occasion of that scheme chargeable payment, and
(b)if two or more scheme chargeable payments are made during the period of 12 months, the aggregate of the percentages of the pension fund used up on the occasion of each of those scheme chargeable payments.
(4)The percentage of the pension fund used up on the occasion of a scheme chargeable payment is—
SCP is the amount of the scheme chargeable payment, and
AA is an amount equal to the aggregate of the amount of the sums and the market value of the assets held for the purposes of the pension scheme at the time when the scheme chargeable payment is made.
(5)A failure by a scheme administrator to provide information required to be provided to the Inland Revenue by or under this Part is significant if—
(a)the amount of information which the scheme administrator fails to provide is substantial, or
159Appeal against decision to de-register(1)This section applies where the Inland Revenue decides to withdraw the registration of a pension scheme under section 157.
(2)The scheme administrator, or any person notified under that section of the withdrawal of registration, may appeal against the decision.
(5)An appeal under this section against a decision must be brought within the period of 30 days beginning with the day on which the appellant was notified of the decision.
(6)The Commissioners before whom an appeal under this section is brought must consider whether the registration of the pension scheme ought to have been withdrawn.
(7)If they decide that the registration of the pension scheme ought to have been withdrawn, they must dismiss the appeal.
(8)If they decide that the registration of the pension scheme ought not to have been withdrawn, the pension scheme is to be treated as having remained a registered pension scheme (but subject to any further appeal or any determination on, or in consequence of, a case stated).
Chapter 3Payments by registered pension schemesIntroductory160Payments by registered pension schemes(1)The only payments which a registered pension scheme is authorised to make to or in respect of a member of the pension scheme are those specified in section 164.
(2)In this Part “unauthorised member payment” means—
(a)a payment by a registered pension scheme to or in respect of a member of the pension scheme which is not authorised by section 164, and
(b)anything which is to be treated as an unauthorised payment to or in respect of a member of the pension scheme under section 172, 173 or 174.
(3)The only payments which a registered pension scheme that is an occupational pension scheme is authorised to make to or in respect of a sponsoring employer are those specified in section 175.
(4)In this Part “unauthorised employer payment” means—
(a)a payment by a registered pension scheme that is an occupational pension scheme, to or in respect of a sponsoring employer, which is not authorised by section 175, and
(b)anything which is to be treated as an unauthorised payment to a sponsoring employer under section 181.
(5)In this Part “unauthorised payment” means—
(a)an unauthorised member payment, or
(b)an unauthorised employer payment.
(6)As well as section 157 (de-registration), the following provisions—
(a)section 208 (unauthorised payments charge),
(b)section 209 (unauthorised payments surcharge),
(c)section 239 (scheme sanction charge), and
(d)section 242 (de-registration charge),
specify consequences of making unauthorised payments.
(7)Sections 182 to 185 contain provision about amounts that a registered pension scheme is not authorised to borrow.
(8)As well as section 157, sections 239 and 242 specify consequences of unauthorised borrowing.
(9)Schedule 36 contains (in Parts 3 and 4) transitional provision about unauthorised payments.
161Meaning of “payment” etc(1)This section applies for the interpretation of this Chapter.
162Meaning of “loan”(1)This section applies for the interpretation of this Chapter.
(2)“Loan” does not include the purchase of or subscription to debentures, debenture stock, loan stock, bonds, certificates of deposit or other instruments creating or acknowledging indebtedness which are—
(a)listed or dealt in on a recognised stock exchange (within the meaning of section 841 of ICTA), or
(b)offered to the public.
(3)A guarantee of a loan made to or in respect of a member or sponsoring employer of a registered pension scheme is to be treated as a loan to or in respect of the member or sponsoring employer of an amount equal to the amount guaranteed.
(4)If a member or sponsoring employer of a registered pension scheme—
(a)is liable to pay a debt, the right to payment of which constitutes an asset held for the purposes of the pension scheme, but
(b)is not required to pay it by the relevant date,
the debt is to be treated as a loan made by the pension scheme to the member or sponsoring employer on that date.
(5)The relevant date is the date by which a person at arm’s length from the pension scheme might be expected to be required to pay the debt.