2. Advice should be provided to the member (or, for modification exercises, advice may be replaced with guidance if the exercise meets a value requirement). Advisers need to be suitably qualified and independent. The employer should pay for the advice. Remuneration must not be related to take-up rates or involve commission. 3. Communications with members should be fair, clear, unbiased and straightforward. Employer communications should not attempt to influence the member one way or another. 4. Parties need to keep records so that there is an audit trail. 5. There needs to be enough time for members to make up their minds without undue pressure. This means at least three months from the date of receiving final information and communications on the offer, and at least two weeks from the date of the final advice or guidance. Members should also have a two-week cooling off period. 6. Member advisers need to comply with a "vulnerable client policy". Incentives should only be offered to members over age 80 on an "opt-in" basis – by sending an initial short letter advising them that they will not be contacted again unless they ask for a full offer pack. 7. All parties need to be aware of their roles and responsibilities and act in good faith. Trustees and advisers may choose not to participate at all if the exercise does not follow the code. Any concerns about the way incentive exercises are being run should be reported to the Pensions Regulator.
Read more from Pinsent Masons
HMRC WINS APPEAL CASE ON NATIONAL INSURANCE PAYMENTS INTO FURBS
12 June 2012
The Court of Appeal has ruled that National Insurance contributions are due on pre-6 April 2006 employer payments into Funded Unapproved Retirement Benefit Schemes (FURBS),
IFA Online reports:
In Forde and McHugh (FML) v the Commissioners of HM Revenue & Customs (HMRC) , HMRC imposed an employer NI contribution liability on £163,000 paid into a FURBS during the 2002/03 tax year, only to lose on FML's appeal to the Upper Tribunal. But the Upper Tribunal's decision has now been reversed with one judge stating five reasons as to why these contributions constituted earnings paid to or for the benefit of McHugh and were therefore subject to NI. Consultant LCP said HMRC would be pleased with this result. "It now appears that they could otherwise have been exposed to repayment claims of up to £8.5m arising from contributions to unapproved retirement benefit schemes. But given the amount riding on this, it will be interesting to see whether it now goes to the Supreme Court," it commented. FURBS were introduced to provide benefits for pension scheme members with earnings above the pre-existing salary cap. A-Day, 6 April 2006, introduced a lifetime allowance to pension saving, replacing the salary cap. The use of FURBS consequently significantly decreased
INDUSTRY CHALLENGED TO PROVIDE GOOD VALUE GUARANTEES FOR PENSIONS
11 July 2012
CIPP Policy News Journal
12/04/2013, Page 268 of 362
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