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.
The Pensions Regulator (TPR) has updated its statement on defined benefit (DB) surplus flexibilities. The introductory wording has been amended to clarify that, “figures used within the case studies are not intended to be benchmarks. As a regulator we have not set expectations regarding either the sharing of surplus or the level of value that may be released”. The statement will be replaced by more detailed guidance, which TPR says that it will be consulting on towards the end of 2026. TPR says that this will be timed to support the enactment of regulations under the Pension Schemes Act 2026 that introduce new flexibilities for surplus release.
HM Revenue and Customs (HMRC) has published a detailed second technical note on pensions and inheritance tax (IHT). The note provides further information on “notional property” that is caught by the new regime, information sharing requirements, withholding notices and operation of the process, pensions direct payment scheme notices and operation of the process, as well as clearance. It includes a timeline of what will be issued and when. The note also includes further information on verifying personal representatives, as well as the position where there are “prospective” personal representatives, along with some helpful case studies.
HMRC has published Newsletter 184. This covers a variety of topics, most unusually including clearance applications and the disposal of nonstandard pension scheme assets. In relation to clearance applications, HMRC says that these should only be made if the question relates to a specific scheme, and the in-depth guidance on pensions tax rules in the Pensions Tax Manual does not provide clarification. The clearance application must explain why the rules are open to more than one interpretation, summarise the different interpretations and explain why the tax consequences are uncertain, as well as specify the pages in the Pensions Tax Manual and relevant parts of the pensions tax legislation that are unclear. HMRC has said that it will only provide clearance in cases of genuine uncertainty, and where all relevant information is provided. In relation to the disposal of nonstandard assets, HMRC says that where an asset is identified as being genuinely worthless, the disposal of such an asset is unlikely to attract unauthorised payment charges. Those that are disposed of that do have a value could incur unauthorised payment charges. HMRC notes that it is the responsibility of the “pension scheme administrator” (this usually means the trustees and not a third-party administrator) to undertake the appropriate due diligence to determine the value of any assets.
Have you seen our Autumn Hot Topics in Pensions? Our cosmic-themed publication is packed with current pensions issues for your trustee and corporate agenda.
If you would like specific advice on any of these issues or anything else, please contact a member of our Pensions team.
