PSI5.2.20 - Contributions by Employers: Ordinary Annual Contributions - Tax Treatment in Advance of Formal Approval

(This archived guidance relates to HMRC discretionary practice before the 6th April 2006. For current guidance on Registered Pension Schemes see the Registered Pension Schemes Manual)

We do not normally issue instructions to Schedule D Tax Districts until schemes are formally approved, and then only in certain cases. If an Inspector asks for advice on the tax treatment of employer contributions at the interim stage, deal with the enquiry as follows:

Schemes: check that the scheme is set up under irrevocable trust and is in principle capable of approval. If it is, the Inspector should be advised that collection of tax in respect of the contributions may be stood over pending formal approval. See PSI5.3.23if special contributions have been paid.
Individual arrangements: we try to avoid use of the interim deed procedure for individual arrangements (see PSI18.1.11). If, therefore, all other features are satisfactory advise the Inspector to stand over the tax on the employer's contributions even where no trust instrument has been executed.

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