EIM21802 - Particular benefits: pension provision: pensions advice provided by an employer: exemption from charge

Pensions information and advice provided by an employer to employees generally (e.g. a presentation to which all employees are invited to attend) is unlikely to give rise to an employee benefit tax charge. However, where an employer pays fees to an external provider for one-to-one sessions to provide advice to employees, as a general principle a tax charge will arise on the cost of the advice as this represents an employment-related benefit.

Statutory Instrument 2002/205 as amended by S.I. 2004/3087

From 14 December 2004, Regulation 5 of S.I.2002/ 205 exempts from a benefits charge the cost of pensions advice and information provided specifically to an employee (e.g. in a one to one session), as long as

• similar advice is offered to all employees, and
• the nature of the advice does not extend beyond pensions into general financial, and particularly tax, advice and
• the cost is no more than £150 per employee per year.

If the cost of the advice exceeds £150 per person the whole amount is taxable, not just the excess over £150.