RPSM13102170 - Technical Pages: International: Application of charges to non-UK schemes: Member payment charges and taxable property unauthorised payment charge: Member's relevant transfer fund

Relevant transfers: member's relevant transfer fund

The member payment provisions do not apply to payments made from a relevant non-UK scheme to (or treated as made to), or in respect of, a transfer member of the scheme unless the payment is referable to that member's relevant transfer fund under the scheme.

The member's relevant transfer fund under a relevant non-UK scheme ( RPSM13102130 refers) is the amount held in the scheme in respect of a member that represents their relevant transferred sums or assets.

Relevant transferred sums or assets means any sums or assets transferred directly, or indirectly, into a member's arrangement under the relevant non-UK scheme from a registered pension scheme or, in certain circumstances, from another relevant non-UK scheme. Such a transfer must have been made after 5 April 2006 and when the relevant non-UK scheme was an overseas pension scheme ( RPSM14101020 to RPSM14101070 refer).

The amount of the member's relevant transfer fund under a relevant non-UK scheme is calculated in accordance with paragraph 4 of schedule 34 and Regulation 3 of The Pension Schemes (Application of UK Provisions to Relevant Non-UK Schemes) Regulations 2006. It is the sum of the following amounts:

1. the amount crystallised by virtue of benefit crystallisation event 8 ( RPSM11102010 and RPSM11102020 refer) on the transfer from a registered pension scheme to the relevant non-UK scheme (see RPSM14101000).
   
   
2. so much of the member's UK tax-relieved fund ( RPSM13102150 refers) previously held under any other relevant non-UK scheme that has been transferred to the relevant non- UK scheme but has not been subject to the unauthorised payments charge (see RPSM04104500); and
   
   
3. so much of the member's relevant transfer fund previously held under any other relevant non-UK scheme as has been transferred into the current relevant non-UK scheme if it was transferred without being subject to the unauthorised payments charge.

There will only be amounts under a, b or c if the relevant non-UK scheme was a qualifying recognised overseas pension scheme (see RPSM14101050) when receiving the transfer. If it was not, the transfer will not have been a benefit crystallisation event and will have given rise to an unauthorised payments charge.

The amounts to be used in the calculation are the amounts transferred to the scheme.

RPSM13102180 gives some examples.

The relevant transfer fund relates to a particular relevant non-UK scheme so if an individual is a member of two such schemes they will have two separate funds.

Under The Pension Schemes (Application of UK Provisions to Relevant Non-UK Schemes) (Amendment) Regulations 2006 a member may have a taxable asset transfer fund within their relevant transfer fund under a relevant non-UK scheme. A member’s taxable asset transfer fund is the sum of the amount in a above and of so much of the amount in c above that has not previously been the member’s UK tax-relieved fund under another relevant non-UK scheme. The taxable asset transfer fund therefore forms part of the member’s relevant transfer fund under a relevant non-UK scheme except where the relevant transfer fund under that scheme consists solely of a UK tax-relieved fund which has been transferred to it (see RPSM13102195).