RPSM12303030 - Scheme Administrator Pages: Information Requirements and Administration: Information the scheme administrator is required to provide to the scheme member: Crystallised benefits and benefit crystallisation events - statement to member

Crystallised benefits and benefit crystallisation events: statement to member

The scheme administrator must provide the member with a statement showing the percentage of the standard lifetime allowance expended by benefit crystallisationevents. The information that the statement must contain is set out below.

When the statement must be provided

The scheme administrator must give the member a statement

• at least once every tax year where the member has an actual entitlement to be paid a pension, or
• within 3 months of a benefit crystallisation event in respect of the member.

The scheme administrator is not required to provide a statement within 3 months of a benefit crystallisation event if a statement is required under

• regulation 14(1)(a) – where the member has become entitled to a pension (see above), or
• regulation 8(2) – information from the scheme administrator to personalrepresentatives on payment of either a defined benefits lump sum death benefit or an uncrystallised funds lump sum death benefit - see RPSM12304010.

HMRC will not normally seek to raise a penalty where the scheme administrator has not been able to provide the statement to the member in the tax year in which the benefit crystallisation occurs as long as the member is provided with the statement within 3 months of the BCE.

There is no requirement to provide a statement to the member

• if a statement containing the same information is required to be provided by an insurance company under regulation 16, 17 or 17A – see RPSM12306004, RPSM12306020 and RPSM12306040, or
• in relation to a relevant existing pension (see RPSM11104910) to which an individual had an actual (as opposed to prospective) entitlement on 5 April 2006.

Where the first benefit crystallisation event in respect of the member triggers a 'deemed BCE' under Article 28 of The Taxation of Pension Schemes (Transitional Provisions) Order 2006 - SI 2006/572 (see RPSM09104542), a reporting requirement arises in respect of that 'deemed BCE'. The scheme administrator for the scheme in which the 'deemed BCE' occurs must provide a statement to the member in respect of the 'deemed BCE', within 3 months of the actual BCE which triggered it.

Information required on the statement to the member

The statement has to show the percentage of the standard lifetime allowance expended by the following benefit crystallisation events

• the member’s benefit crystallisation events in respect of the scheme to the extent that the sums or assets subject to any such BCE have not been transferred to another registered pension scheme, and
• where the scheme has received (directly or through earlier transfers) a transfer in respect of the member, any benefit crystallisation event, prior to the transfer, in connection with the sums or assets represented by the transfer, including ongoing investments from sums or assets represented by the transfer.

The percentage expressed on the statement should go to two decimal places (i.e. 25.55%). This should be a rounded down figure, so 25.558% becomes 25.55%.

Details of how to calculate the percentage of standard lifetime allowance expended on the happening of a benefit crystallisation event can be found on page RPSM12303040.

A pension commencement lump sum can be paid up to 12 months after the entitlement to the connected pension arises. The maximum allowable amount of pension commencement lump sum is linked to the value of the pension that the member becomes entitled to.

Where the pension commencement lump sum has not been paid before the statement to the member is required the scheme administrator may not know the value of the BCE in respect of the pension commencement lump sum. However the scheme administrator will know the approximate amount that is planned to be paid by the scheme. This is the amount that should be used when calculating the percentage of standard lifetime allowance to be shown on the statement. If the final amount of pension commencement lump sum is different from the amount originally intended to be paid an amended statement can be made to the member.

Substitute P60s

An option for scheme administrators is to provide this information to members by including the figure on form P60 substitute issued annually to members in receipt of a pension. Any scheme administrator wishing to adapt form P60 substitute for this purpose should first contact