Tom receives a payment of £250,000 from a relevant non-UK
scheme when he is 45 years old. It is an unauthorised payment. His
total fund within that scheme is £500,000.
If he has a UK tax-relieved fund of £200,000 and does
not have a relevant transfer fund or a taxable asset transfer fund
he will be liable to a member payment charge on £200,000 - the
total of the UK tax-relieved fund as that is smaller than the
payment.
If he has a UK tax-relieved fund of £200,000 and has a
relevant transfer fund of £200,000, which includes within it a
taxable asset transfer fund of £100,000 he will be liable to a
member payment charge on £250,000. His UK tax-relieved fund
will be reduced to nil and he will be left with a relevant transfer
fund of £150,000, and a taxable asset transfer fund of
£100,000.
On 25 May 2007 Rob transfers £500,000 from his relevant
non-UK scheme (scheme B), which is a
qualifying recognised overseas pension scheme, to
an overseas scheme (scheme C) that is not a qualifying recognised
overseas pension scheme The transfer does not include an
appropriated asset At that time the total value of his funds in
scheme B is £1.2 million. He has a UK tax-relieved fund in it
of £300,000. He also has a relevant transfer fund in it of
£600,000 – all of which is a taxable asset transfer
fund- as a consequence of a transfer of that amount from a
registered pension scheme (scheme A). The transfer
from scheme A to scheme B was a
benefit crystallisation event 8 under section 216.
It did not give rise to an
unauthorised payments charge.
He is liable to an unauthorised payments charge of 40% and an
unauthorised payments surcharge of 15% on the
£500,000 transferred to scheme C. That is because this is not
a recognised transfer. The surcharge applies because the whole of
the transferred amount of £500,000 is treated as coming from
his UK tax-relieved fund, his relevant transfer fund, and his
taxable asset transfer fund and because that amount exceeds 25% of
the value of his rights under scheme B. His UK tax-relieved fund in
scheme B is reduced from £300,000 to nil and his relevant
transfer fund is reduced from £600,000 to £400,000, as is
his taxable asset transfer fund.
On 13 November 2009 he transfers £600,000 from scheme B
to scheme C. The transfer does not include an appropriated asset.
The total value of his funds in scheme B at that time is
£850,000. He has a UK tax-relieved fund in it of £100,000
because his employer has made UK tax-relieved contributions of that
amount to it since the previous transfer was made. His relevant
transfer fund (and taxable asset transfer fund)in it is still
£400,000. He is liable to an unauthorised payments charge of
40% and an unauthorised payments surcharge of 15% on the
£500,000 transferred to scheme C from his UK tax-relieved fund
and from his relevant transfer fund (and taxable asset transfer
fund) in scheme B. Both his UK tax-relieved fund and his relevant
transfer fund (and taxable asset transfer fund) in scheme B are
reduced to nil. The other £100,000 that was transferred is not
subject to such charges.
| Glossary ( RPSM20000000) |
