Amendment of the Police Pensions Regulations 1987
8. After regulation L4 (payment of awards otherwise than to a beneficiary and application of payments)(1), insert—
“Scheme manager to be scheme administrator for purposes of Part 4 of Finance Act 2004
L5. The scheme manager is appointed to be responsible for all functions that are functions conferred or imposed on the scheme administrator by or under Part 4 of the 2004 Act (pension schemes, etc.).
Payment on behalf of members of lifetime allowance charge
L6.—(1) A member of this scheme may request the scheme manager to pay, on the member’s behalf, any amount that is payable by way of the lifetime allowance charge under section 214 of the 2004 Act (“the amount”) if—
(a)an event that is a benefit crystallisation event (“the event”) listed in column 1 of the table in section 216(1) of the 2004 Act occurs in relation to the member, and
(b)the member and the scheme manager are jointly and severally liable in relation to the event.
(2) A request may only be made by notice given to the scheme manager before the event occurs.
(3) If the member pays the amount to the scheme manager on or before the date on which the event occurs, the scheme manager may comply with the request.
Reduction of benefits where lifetime allowance charge payable
L7.—(1) This regulation applies if—
(a)an event that is a benefit crystallisation event (“the event”) listed in column 1 of the table in section 216(1) of the 2004 Act (“the table”) occurs in relation to a member,
(b)the member and the scheme manager are jointly and severally liable in relation to the event, and
(c)no request has been duly made under regulation L6 in relation to the event or, if such a request has been made, the scheme manager has not complied with the request.
(2) If this regulation applies—
(a)the scheme manager must pay the tax payable on the event,
(b)if the event is benefit crystallisation event 8 in column 1 of the table in section 216(1) of the 2004 Act (transfer to qualifying recognised overseas pension scheme), the amount or value of the sums or assets transferred must be reduced, and
(c)in the case of any other event in the table, the amount or value of the benefits payable to or in respect of the member must be reduced.
(3) The amount or value of the reduction mentioned in paragraph (2)(b) must—
(a)fully reflect the amount of the tax so paid,
(b)be determined in accordance with guidance provided by the scheme manager, and
(c)in the case of any reduction to pension benefits, be consistent with normal actuarial practice.
Information about payment of annual allowance charge
L8.—(1) If a member’s pension scheme input amount for this scheme for a tax year exceeds the amount of the annual allowance for that tax year, paragraph (2) applies in respect of the member for that tax year.
(2) The scheme manager must, no later than 6 October after the end of the tax year, provide the member with any information the scheme manager considers appropriate to assist the member to arrange payment of the annual allowance charge for that tax year.
Reduction of benefits where annual allowance charge paid by scheme manager
L9.—(1) This regulation applies where—
(a)a member gives a valid notice to the scheme manager of—
(i)joint and several liability to an annual allowance charge under section 237B of the 2004 Act (liability of scheme administrator)(2), or
(ii)liability to an annual allowance charge in accordance with regulation L10, and
(b)the scheme manager satisfies the liability specified in the notice.
(2) The amount or value of the benefits payable to or in respect of the member for the tax year to which the notice relates must be reduced by the scheme manager in accordance with paragraph (3).
(3) Subject to paragraph (4), the amount or value of the reduction of benefits—
(a)must fully reflect the amount paid by the scheme manager,
(b)in the case to which paragraph (1)(a)(ii) applies, where liability has arisen in relation to more than one police pension scheme, must be proportionate to the part of that liability which relates to this scheme, and
(c)must be consistent with normal actuarial practice.
(4) Benefits may only be reduced under this regulation to the extent that the reduction would not result in the loss of any part of a guaranteed minimum pension to which a person is entitled under section 14 (earner’s guaranteed minimum) or 17 (minimum pension for surviving spouses and civil partners) of the 1993 Act(3).
(5) In this regulation, “police pension scheme” means this scheme, and the schemes provided for in the Police Pensions (Scotland) Regulations 2007(4) and the Police Pension Scheme (Scotland) Regulations 2015(5).
Voluntary scheme pays arrangement
L10.—(1) A member may serve notice on the scheme manager requesting the scheme manager to discharge an annual allowance charge where the conditions in paragraph (2) are satisfied.
(2) The conditions mentioned in paragraph (1) are that—
(a)the scheme manager is not jointly liable under section 237B of the 2004 Act (liability of scheme administrator) in relation to the charge,
(b)the pension scheme input amount for a tax year for the member in relation to all police pensions schemes of which the individual is a member, exceeds the annual allowance applicable to that member for that tax year, and
(c)the amount of the member’s liability to an annual allowance charge for that tax year exceeds £1,000.
(3) The scheme manager may fix a date in relation to a tax year by which a notice under paragraph (1) must be given.
(4) When the scheme manager satisfies a liability under paragraph (1), consequential adjustment must be made to the member’s entitlement to benefits under this scheme on a basis that is just and reasonable having regard to normal actuarial practice.
Interpretation of Part L
L11. In this Part—
“annual allowance” has the meaning given in section 228(1) of the 2004 Act (annual allowance)(6),
“annual allowance charge” has the meaning given in section 227(1) of the 2004 Act (annual allowance charge)(7),
“pension scheme input amount” has the meaning given in section 237B(2) of the 2004 Act, and
“tax year” means a period of one year which is the period of assessment for income tax purposes.”.
Regulation L4 was amended by S.I. 2002/3202.
Section 237B was inserted by paragraph 15 of schedule 17 of the Finance Act 2011 (c.11) and was relevantly amended by S.I. 2015/80.
Section 14 was relevantly amended by paragraph 15 of schedule 13 of the Pensions Act 2014 (c.19). Section 17 was relevantly amended by S.I. 2005/2050.
Section 228(1) was substituted by section 49(2) of the Finance Act 2013 (c.29).
Section 227(1) was relevantly amended by paragraph 63 of schedule 1 of the Taxation of Pensions Act 2014 (c.30) and paragraph 11 of schedule 4 of the Finance (No. 2) Act 2015 (c.33).