Here is our weekly summary of key legal and regulatory developments relevant to occupational pension schemes, which you might have missed, with links for further information.
The off-payroll working rules (IR35) apply if a worker provides their services to a client through a personal services company (or any other intermediary), but would be classed as an employee if they were contracted directly. The government delayed its reform of the rules last year. The reform will now come into force on 6 April 2021, relating to payments made for services provided on or after 6 April 2021. The onus on assessing whether the rules apply will shift from the personal services company to the end client if the end client is a medium or large private sector organisation or subsidiary of such an organisation (in the same way that the onus is already placed on public sector organisations). If the rules apply, the end client will also become responsible for ensuring the deduction of appropriate national insurance contributions and tax before paying fees to the personal services company. Trustee boards and sponsoring employers should assess whether any trustees/trustee directors provide their services through an intermediary and whether IR35 will be relevant. If in doubt, seek advice.
The Pensions Regulator (TPR) has published its latest compliance and enforcement bulletin, covering the period October to December 2020. In TPR's press release, it notes that its use of statutory powers has increased by nearly 50% overall from the previous quarter in line with expectations. During the period, TPR used its information gathering powers (under section 72 of the Pensions Act 2004) 13 times and it did not issue any clearance statements. It will be interesting to see whether these figures will change once TPR's new powers under the Pension Schemes Act 2021 come into force. In particular, we expect to see more sponsoring employers seeking clearance before entering into a transaction or restructuring that could potentially be caught by the new tests being introduced in relation to contribution notices.
Watch out for the second blog in our GMP Equalisation Under the Microscope series, which will examine the extent to which trustees should chase top-up payments relating to past statutory cash equivalent transfer values received by their scheme, in light of the recent Lloyds judgment.
Congratulations to Victoria Jeacock and Gemma Bennett, in our Pensions team, for their recent promotions! Victoria becomes a partner, while Gemma has been promoted to director.
If you would like specific advice on any of these issues, or on anything else, please contact a member of our Pensions team.
