Here is our weekly summary of key legal and regulatory developments relevant to occupational pension schemes that you might have missed, with links for further information.
Following publication of the autumn finance bill, HM Revenue & Customs (HMRC) has issued newsletter 154. The newsletter gives a high-level overview of what is included in the finance bill and highlights which proposals have been dropped. HMRC says that following consultation with stakeholders over the summer, there will be no change to the tax treatment of inherited pensions where the member dies before age 75. Payments that were benefit crystallisation event 5C or 5D will remain available, and their tax treatment is not amended by the finance bill. The reduction of the authorised surplus payment tax charge from 35% to 25% for sponsoring employers will be introduced through regulations and will be effective from 6 April 2024. (We remind readers that we are expecting a consultation this winter on possible changes to rules around when defined benefit scheme surpluses can be repaid.)
Chris Curry, principal of the Pensions Dashboards Programme, has published a blog answering some common questions around dashboards standards and types of testing. He also notes in his blog that at least six months' notice will be given regarding the dashboards available point (i.e. the date that dashboards are made available to the general public), which might be before the connection deadline of 31 October 2026.
Following the consultation that closed in January 2023, the Financial Conduct Authority (FCA) has published policy statement PS23/16 setting out sustainability disclosure rules for asset managers. The policy statement includes an anti-greenwashing rule for all FCA authorised firms to reinforce that sustainability-related claims must be fair, clear and not misleading. The FCA is consulting on supporting guidance. The greenwashing rule will come into force on 31 May 2024. The package of measures also includes four investment labels, disclosure, and naming and marketing rules, which will apply to UK asset managers marketing investment funds based on their sustainability characteristics. Firms can use the investment labels from 31 July 2024, while the naming and marketing rules will come into force on 2 December 2024.
Pensions for Purpose has published its report on impact investment performance. The report notes investment performance data was gathered from 17 asset managers with UK pension fund clients, based in either Europe or the US, with total impact assets under management of £18.6 billion. The conclusion of the report was that the "cumulative investment performance results are consistent with academic research, which suggests there is no reason why impact funds should not achieve competitive risk-adjusted returns compared to conventional funds".
If you would like specific advice on any of these issues or on anything else, please contact a member of our Pensions team.