RPSM04104060 - Technical Pages: Taxation: Unauthorised payments: Overview: What is a payment?

What is a payment?

A payment is not just a payment of a monetary amount. The definition of a payment also includes

• a transfer of assets, and
• any other transfer of money’s worth.

Any payment made (or benefit provided) from, or connection with, an investment acquired with registered pension scheme funds is treated as a payment or benefit from that registered pension scheme. This is the case even if the pension scheme has wound up and/ or the investment was acquired after the scheme has wound up.

In this context an investment includes insurance and annuity contracts.

So a payment could include the following.

• Giving a pension scheme asset, e.g. shares, to an individual or other person
• Selling a pension scheme asset for less than it is worth (this is a transfer of value or money’s worth to the recipient)
• The pension scheme buying an asset for more than its market value (this is a transfer of money’s worth to the seller)

This is not meant to be a complete list of payments

There are also special rules for payments to persons connected with members, former members, sponsoring employers or former sponsoring employers – see RPSM04104070.