To all regular visitors we apologise for the recent hiatus in new announcements here. This report is intended to sweep up anything you might have missed. The Aries team has been very busy lately with the new release (v9.3) of the Aries Pensions System and our stand at the NAPF Annual Conference & Exhibition, which excited a lot of interest.

HMRC matters

1. HMRC / JWG Technical Meeting (16 May 2006): around twenty questions and answers on the new pensions tax regime.

2. Draft Regulations: a list of five quite short and probably uncontroversial draft SIs under FA 2004.

3. Note on calculation of lump sums from money purchase schemes: flags up a forthcoming amendment to the provision of information regs, consequential upon the change in this year’s Finance Bill to the basis for calculation of a PCLS paid in connection with a scheme pension from a MP arrangement.

4. Draft forms: Event Report and Pension Scheme Return, including amendments resulting from Finance Bill 2006.

5. NISPI Pensions Industry Newsletter Issue 23 (June 2006) [PDF]: this publication series deals with practical aspects of the administration of contracting-out. In future, will be available only in electronic form (email and on the web). The current issue includes somewhat controversial insistence that schemes in receipt of overpaid age-related rebates (as a result of members having transferred out) are responsible for returning the overpayment, regardless of whether they are able to recover the money from the new provider or not.

6. Pensions Tax Simplification Newsletter No. 15: although this publication normally appears at the end of each month, 30 June is the end of the first quarter for 'accounting for tax' (AFT) purposes under the new regime. The deadline for filing and payment is 14 August. To facilitate online filing, the Newsletter provides advance details of the next release in July of Pension Schemes Online. No acknowledgement of any problems with the service, but HMRC "would like to hear about your experiences and any improvements that you would like to see." Paper filing will be acceptable, but in this case the return must be signed by the Scheme Administrator (a Practitioner can submit online).

7. Finance (No. 2) Bill 2006 update: on Tuesday 20 June the House of Commons Standing Committee completed its deliberations on the clauses relevant to pensions, ie those on taxable property and recycling of lump sums. Some Government Amendments were tabled. Royal Assent is expected in the latter half of July. (Although likely to become simply the Finance Act 2006, the Bill is labelled the "No. 2" Bill because there has been a previous Finance Bill in the 2005/06 session (it became the Finance (No. 2) Act 2005.)

8. Responses to IHT consultation: a brief summary of points made by the 83 respondents to last July's discussion paper on the application of IHT law under the new regime.

9. Pipeline lump sum death benefits: on 22 June HMRC announced a welcome relaxation of the 2-year rule to allow payment within 2 years of the date trustees could "reasonably have known" about the member's death. This applies only where the death occurred before 6 April 2006. It will nevertheless encourage those lobbying for a more generally applicable relaxation, especially for cases where the member was untraceable at age 75.

Other developments

1. Occupational Pension Schemes (Disclosure of Information) Regs: one of the few SIs outstanding under the Pensions Act 2004. Postponed to October 2006 to allow more time to consider responses to the consultation draft. The DWP recently conducted a rapid private consultation on the latest version. The Government has already announced that annual benefit statements will not be required for deferred members of defined benefit schemes.

2. Codes of Practice: via SI 2006/1383 four more Codes were brought into effect on 30 May 2006. These are:

1. the Pensions Regulator Code of Practice No. 4: Early leavers – reasonable periods;
2. the Pensions Regulator Code of Practice No. 5: Reporting late payment of contributions to occupational money purchase schemes;
3. the Pensions Regulator Code of Practice No. 6: Reporting late payment of contributions to personal pensions; and
4. the Pensions Regulator Code of Practice No. 7: Trustee knowledge and understanding (TKU).

Codes of Practice Nos. 1 - 3 (reporting breaches of the law; notifiable events; and funding defined benefits) came into force on 6 April 2005, 30 June 2005, and 15 February 2006 respectively.

The Code of Practice on MNTs is imminent. Consultation on the three remaining Codes (the one on Dispute Resolution having been shelved along with the PA 2004 changes) has closed and responses are currently being considered.

3. Latest TPR guidance:

1. use of contingent assets;
2. summary funding statements; and
3. clearance

4. White Paper: the Government's proposals have been extensively reported in the press. Rather less attention has been paid to a promise in the accompanying Ministerial Statement on Pensions Reform to have another look at what can be done to simplify DWP legislation, even (perhaps) to emulate the Tax Law Rewrite Project. In particular, the Minister resuscitated the plan to enable schemes to convert GMPs into scheme benefits; this has languished on one of the DWP's extensive array of back-burners since the original consultation on three options in spring 2003. The notoriously restricted Financial Assistance Scheme is to be extended to cover eligible people who were within 15 years of NRA on 14 May 2004, and allocated more money.

5. Age Discrimination: new DTI regulations come into force on 1 October 2006, but they won’t cover pension benefits accrued before that date. From that date, every occupational pension scheme will be treated as having a non-discrimination rule. In a 35-page document titled "The Impact of Age Regulations on Pension Schemes", the Government has published an extensive list of exemptions covering many existing pension scheme practices. However, anything not on this list may be illegal.

6. Law Commission consultation paper "Cohabitation: The Financial Consequences of Relationship Breakdown": proposes that in strictly limited circumstances, there should be a scheme for financial remedies for certain cohabitants on separation.