RPSM13102184 - Technical pages: International: Application of charges to non-UK schemes: Member payment charges and taxable property unauthorised payment charge: Application of taxable property unauthorised payment charge

Application of taxable property unauthorised payment charge

[The Pension Schemes (Application of UK Provisions to Relevant Non-UK Schemes) (Amendment) Regulations 2006 - SI 2006/1960] 

The Pension Schemes (Application of UK Provisions to Relevant Non-UK Schemes) (Amendment) Regulations 2006 provide for the application of the unauthorised payment charge imposed by virtue of

1. section 174A, or
2. regulations made under paragraph 37 of schedule 29A or paragraph 7A of schedule 34.

RPSM04301100 and RPSM13102180 provide more information about those charges. A charge applies in relation to payments treated as made by those provisions to, or in respect of, a transfer member of a relevant non-UK scheme. But it only applies if the payment is referable to the member’s taxable asset transfer fund under the scheme (see RPSM13102195).

The regulations provide also for the application of an unauthorised payment charge on income or gains from taxable property (see RPSM04301100).

The scheme chargeable payment provisions in sections 185A to 185I do not apply to a relevant non-UK scheme. But during such time as an appropriated asset forms the whole or part of a transfer member’s taxable asset transfer fund

1. the scheme is treated as making unauthorised payments to that member equal in amount to the scheme chargeable payments in respect of income and gains which would have been computed in accordance with those sections, and
2. the transfer member is liable to pay the unauthorised payment charge in respect of such payments.

Where the scheme’s interest in taxable property is not wholly referable to the transfer member’s taxable asset transfer fund, the amount of the unauthorised payment is proportionately reduced.