HMRC have published their latest Pension Scheme newsletter (162 September 2024) and ICB is providing an overview of some of the contents.
Lifetime Allowance (LTA) Abolition
This section refers back to the Pension Schemes Newsletter 158 (April 2024) and how legislation will be introduced to address ‘technical inaccuracies’ in the legislation that abolished it from April 2024. At this time, two new allowances were introduced on most lump sum benefits (the Individual Lump Sum Allowance and Individual Lump Sum and Death Benefit Allowance).
HMRC say that the correcting Regulations will ‘be introduced as soon as parliamentary time allows’.
As we have stated, this is not an issue that bookkeepers should advise on but, maybe, you can point clients to ‘Lifetime allowance (LTA) abolition ― frequently asked questions’ on Gov.UK.
Lump Sum Reporting Workshop
A lump sum can be taken from an individual’s pension ‘pot’ when their reach Normal Retirement Age (currently 55). Some of this can be taken free of income Tax whilst the remainder may be subject to a liability.
This section reminds administrators that workshops will be held with HMRC in October 2024 on how lump sums are reported via Real Time Information (RTI), reminding them that reporting changes are effective April 2025.
Relief at Source
This section is almost a repeat of information in previous newsletter and reminds pension scheme administrators that the deadline for submitting 2023/24 annual returns has passed (05 July 2024). However, there are some returns that are still outstanding from scheme administrators, even though they may have submitted 2024/25 repayment claims.
The message is for 2023/24 returns to be completed and a reminder for scheme administrators that the annual returns must be formatted correctly.
The Managing Pension Schemes Service
This is an online service that will replace the Pension Schemes Online service in April 2025. The message in the newsletter is ‘You should take action now to migrate your pension schemes to the Managing pension schemes service.’
Scheme administrators have been migrating from Pension Schemes Online to the Managing Pension Schemes Service over the last few years and there are two steps:
1. Enrol (on the Managing Pension Schemes Service), then
2. Migrate
For Bookkeepers
As ICB have stated, bookkeepers are responsible for the collection, reporting and remittance of pension contributions, not administration of the pension scheme itself. Publication of this Newsletter is to ensure members are aware of its existence and the messages that are being relayed to scheme administrators.
