The Chartered Institute of Payroll Professionals ……………………………………………………………Policy News Journal
about how to exercise the new pension freedoms, savers are often confused and have said they want some clear guidance. We hope the RQM can offer savers the support they’re looking for.”
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Pension schemes newsletter 81 28 September 2016
HMRC have published the Pension Schemes newsletter 81 which contains details of the Beta launch of the new annual allowance calculator.
The new annual allowance calculator will enable Pension scheme members to check: How much annual allowance they have used If they have an annual allowance charge to pay If they have any unused pension annual allowances to carry forward
Launching the calculator as a beta version means that HMRC will review and improve the calculator and they welcome feedback from scheme members about using the calculator. Feedback can be given by using the feedback option directly on the GOV.UK pages or by emailing them directly putting ‘Annual allowance calculator’ in the subject line of your email.
The annual allowance calculators and tools for previous years will still be available on GOV.UK and members can find more information about the annual allowance rules in the guide .
Newsletter 81 also includes articles on: Event Report Relief at source annual returns of individual information for 2015 to 2016
Secondary annuities Lifetime allowance The ever present threat pension scams that has increased since the introduction of Pension freedoms in 2015. Tax treatment of serious ill health lump sums Pension Schemes Newsletter 77, at Budget 2016 the government announced a number of measures relating to the pension tax rules. This included replacing the 45% tax charge on serious ill-health lump sums paid to individuals who have reached age 75 with tax at the individual’s marginal rate. These measures took effect on 16 September 2016, the day after the date of Royal Assent to Finance Bill 2016. From this date reporting these payments on your accounting for tax return (AFT) should cease with the last AFT that you should report these on being 1 July to 30 September 2016 (due to be submitted by 14 November 2016) and report them through real time information (RTI). HMRC are currently working on the RTI amendments which will include separate fields for serious ill health lump sum payments to individuals over 75 but there will be a delay in the RTI system being updated. Where these details would usually be included in the October release on GOV.UK at RTI internet submissions : 2017 to 2018 technical specifications, the detail of these new fields will now be released in December together with some changes in respect of the Secondary Annuities Market. In the meantime, you should report these payments through RTI. If you have a tax code for your member for the current year you should operate this code on a week 1/month 1 basis against any serious ill health lump sum payment made. If not: deduct tax using emergency code on a week 1/month 1 basis set the occupational pension indicator use the date of payment as the leaving date on their payroll record so this is sent to HMRC when you report your payroll information (a starting date or an entry in the annual amount of Occupational Pension field is not required) prepare a P45 and give it to the pension recipient HMRC are sorry for any inconvenience caused by this delay.
The Chartered Institute of Payroll Professionals
Policy News Journal
cipp.org.uk
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