RPSM03307021 - Scheme Administrator Pages: Protecting pension rights from tax charges: benefit payments - other forms of protection: Pension credits info requirement

Information needed before crystallising benefits using an enhanced lifetime allowance due to pre 6 April 2006 pension credit rights

[Reg 11 The Registered Pension Schemes (Provision of Information) Regulation 2006 – SI 2006/567]

If an individual wants to take advantage of an enhanced lifetime allowance due to pre 6 April 2006 pension credit rights they must give the scheme administrator the reference number of their certificate of protection. This is required by regulation 11 of the Registered Pension Schemes (Provision of Information) Regulation 2006.

A scheme administrator could also ask a member for a copy of their certificate. Alternatively if the member has completed form APSS 203 authorising HMRC to give the scheme administrator details of the certificate, the scheme administrator can view the certificate online. If a scheme administrator would prefer to receive details of the certificate in the post form APSS 209 must be completed in addition to form APSS 203.

If the individual does not give the scheme administrator details of their certificate the administrator should assume that the individual does not have protection. This means the lifetime allowance charge will apply in the usual way.

A scheme administrator will also need to know whether or not the individual has previously had a benefit crystallisation event from any registered pension scheme and if so how much crystallised at that event. So you will need to ask the member

• Have you had any previous benefit crystallisations – if so what percentage of the standard lifetime allowance was used up by the benefit crystallisation event(s)? The administrator(s) of the scheme(s) providing those benefits must have given the member a statement showing how much of the standard lifetime allowance has been used up by the benefit crystallisation.
• If this is the first benefit crystallisation event does the member have any pre- commencement pensions (pensions in payment on 5 April 2006)? If so what is the annual rate of the pension in payment when benefits will crystallise from your scheme?

This information is needed to find out whether or not the scheme administrator will be liable to the lifetime allowance charge because the total benefits crystallised are more than the member’s available lifetime allowance.