Guidance

Countdown Bulletin 49 - October 2019

Published 4 October 2019

In response to feedback from schemes we want to provide clarity about the services and support HMRC will provide now that Scheme Reconciliation Service (SRS) has ended. This bulletin is to confirm HMRC’s role and what it means for you.

HMRC’s service to the Pensions Industry in relation to contracted out pensions is summarised by the following high level descriptions:

• ensuring the correct amount of Guaranteed Minimum Pension (GMP) is calculated for an individual
• making the GMP amount available to DWP to support State Pension calculations
• making the GMP amount available to schemes via the GMP Checker Service and dealing with queries about the amount only at life events
• maintaining and correcting individuals’ National Insurance records, for example where the wrong rate or category of National Insurance has been paid
• information provision within General Data Protection Regulations (GDPR)

Final SRS Outputs

All schemes who engaged in SRS will receive a final data cut later this year. This is based on HMRC records following the completion of all SRS queries. You will not be able to query the information with HMRC.

The schedule may contain members for whom you have not accepted liability. Some you’ll already be aware of because of earlier schedules and some you will not. This is because HMRC continues to trace the SCON for members where the closure scan exercise was unable to close the period. We have closed the scheme membership under the traced SCON.

Before SRS, schemes had a limited view of the scale of the potential liability they were accountable for. The SRS process should have made that potential liability clearer. In addition, by virtue of the reconciliation process the level of potential liability over which there was uncertainty should have reduced to below the level that existed pre SRS.

Scheme Contracted Out Numbers (SCONs)

We know that a key concern for schemes is where HMRC has a SCON recorded for a member and you do not agree with it.

SRS was an opportunity for you to reconcile your records against our records to gain clear and accurate records going forward. We know that not all individuals were reconciled as part of the process however the information we have received from schemes indicates that the number of queries left unresolved is relatively small compared to the number of queries successfully reconciled.

Now that SRS has closed we will no longer amend SCONs on our records where:

• the GMP amount we hold is correct
• it’s only the SCON held on HMRC records that you disagree with

This also applies where there is no GMP liability (for example, all post 1997 liability).

Now that HMRC is no longer tracking scheme membership the importance of the SCON HMRC holds has changed and is not definitive evidence of who holds liability for the members GMP.

We will not share the SCON we hold with customers or their agents unless it is part of a Subject Access Request under GDPR regulations.

We will on occasion share the scheme details we hold, for example when a customer asks for a contracted out employment history. However we will caveat the information because we no longer track scheme membership.

Incorrect GMP

HMRC will amend records if the GMP information we hold for an individual is incorrect. Schemes can use the on-line GMP Checker service at any time, but if they disagree with the GMP supplied or receive an error message and cannot obtain a GMP, a query can only be sent to HMRC if a ‘life event’ is occurring.

You should submit a query using the template in your Live Schemes Shared Workspace e-room.

Contribution Equivalent Premiums (CEP)

There is no longer an opportunity to pay a CEP for members as the time limits to do so have passed.

In addition, due to the financial reconciliation exercise and the agreement between HMRC and schemes that any debt / refunds would be offset and allocated where appropriate, HMRC will not be able to accept queries where schemes believe they paid a CEP but it is not recorded on our records. That is because the money may have been used elsewhere or already refunded.

Raising queries with HMRC

All GMP queries should come to HMRC via the GMP Checker at a life event. If you have another query that fits within the high level descriptions of HMRC’s service but is not appropriate to the GMP Checker you should submit it by email to CRM.schemereconciliationservice@hmrc.gov.uk.

Please explain how your query fits in with HMRC’s service.