Guidance

Pension schemes newsletter 129 – April 2021

Published 30 April 2021

1. Pension flexibility statistics

The quarterly release of official statistics on flexible payments from pensions for the period 1 January 2021 to 31 March 2021 has now been published.

HMRC can now give more information on the number of tax repayment claim forms processed for pension flexibility payments.

From 1 January 2021 to 31 March 2021 we processed:

• P55 = 4,226 forms

• P53Z = 2,365 forms

• P50Z = 787 forms

Total value repaid: £23,183,421

Figures for the period 1 April 2021 to 30 June 2021 will be published in July 2021.

2. Registration statistics

For 2020 to 2021 HMRC received in total 1,760 applications to register new pension schemes.

Of these schemes, 66% have been registered and HMRC has currently refused registration for about 9% of applications. No decision has yet been made on the remainder.

Since 2012 to 2013 HMRC has seen an 88% decrease overall in the number of applications to register pension schemes.

3. Relief at source

3.1. Relief at source for 2021 to 2022

At spring Budget 2021 the government confirmed that the Income Tax rates for 2021 to 2022 for England and Northern Ireland will continue to be the same as for 2020 to 2021.

For 2021 to 2022 the Income Tax rates for England and Northern Ireland are as follows, the:

• basic rate is 20%

• higher rate is 40%

• additional rate is 45%

In pensions scheme newsletter 128 we provided the Scottish and Welsh Income Tax rates for 2021 to 2022. As there are no changes to the rates for England and Northern Ireland, Scotland and Wales for 2021 to 2022, you should continue to operate relief at source as you do now.

3.2. Annual return of information for 2020 to 2021

The deadline for submitting the 2020 to 2021 annual return of information is 5 July 2021. If you do not submit this on time it will hold up:

• interim claims for the tax month ending 5 July 2021

• any claims for subsequent months until we receive your annual return of information

Make sure that you submit the APSS590 Annual return of information declaration when submitting your annual return of information, as this forms part of your return. Without it your return will fail processing.

If you submit your annual return of information but this fails processing, we will:

• still consider this to be outstanding
• stop any subsequent interim repayment claims until we receive a re-submission

If failure occurs on the third submission, we’ll stop all future interim claims until we receive a further re-submission that is considered successful.

You can only submit your 2020 to 2021 annual return of information through the Secure Data Exchange Service.

You can send the APSS590 annual return of information declaration either by post or by email to reliefatsource.administration@hmrc.gov.uk and put ‘APSS590 Annual return of information declaration’ in the subject line.

4. Pension scheme returns

We want to remind you that you’re only required to submit a Pension Scheme Return (PSR) for a pension scheme if you’ve received a notice to file a PSR from HMRC.

The option to file a PSR for a pension scheme for a relevant year will only appear on the Pension Schemes Online service if a notice to file has been issued.

You can find more information about the PSR in the Pensions Tax Manual at PTM163000.

5. Winding up pension schemes

Only pension schemes with a status of ‘open’ will be migrated to the Managing Pension Schemes service.

If you have a pension scheme that needs to be wound up on the Pension Schemes Online service, you’ll need to report this on an event report. You’ll find more information on winding up a pension scheme in our Pensions Tax Manual at PTM168000 .

After a pension scheme is wound up, if necessary, you can still continue to make amendments to previously submitted returns on the Pension Schemes Online service and request any refunds that may be due.

6. Enrolling on the Managing Pension Schemes service

Ahead of migration of pension schemes on to the Managing Pension Schemes service, we want to remind you that you’ll need to enrol on the Managing Pension Schemes service first, under your existing scheme administrator ID. You can do this at any time and we would like to encourage you to do this as soon as possible.

To enrol on the service, you’ll need to enter your scheme administrator details again. You can find a list of the information that you’ll need to enter as a company, individual or partnership in the guide Register as a pension scheme administrator in the section ‘How to register’.

To make sure you keep the same scheme administrator ID, you’ll need to enrol using the same credentials that you use for the Pension Schemes Online service.

We provided more information on how migration of pension schemes will work, information you’ll need and actions you may need to take beforehand in our Managing Pension Schemes service newsletter – March 2021.

This also has a section explaining what will happen and what you need to do if you currently hold multiple scheme administrator IDs for your organisation.

7. Signing in to online services

In Pension schemes newsletter – 126 and earlier newsletters we explained that we were starting an ongoing programme of deleting Government Gateway credentials (user ID and password) for users who have not signed in to a tax service for 3 years. This means that anyone who has not logged into their Business Tax Account in the last 3 years will have their Government Gateway credentials deleted.

This process has now begun and we would encourage you to log into your Business Tax Account as soon as possible. If you try to access the service using deleted credentials, you’ll receive an error message as if the credentials are incorrect.

You can find guidance on how to recover access to the Pension Schemes Online service in part 1.4 of the Pensions Schemes Online: user guide.

If your credentials are deleted, we will not delete your scheme administrator ID, practitioner ID, associations or authorisations with pension schemes.

8. Annual allowance calculator

As part of our annual updates we’ve amended the annual allowance calculator to include the tax year 2021 to 2022.

We’ve added in the 2021 to 2022 tax year so that any members of defined contribution schemes who make their total contributions early in the tax year can work out their annual allowance tax charge. Other members can use the annual allowance calculator after the end of the tax year when they know what their total pension savings will be.

9. Non-taxable payments following a member’s death and Real Time Information (RTI) reporting

The regulations The Pension (Non-Taxable Payments Following Death)(Real Time Information) Regulations 2021 have been made and laid.

You can find more information about these regulations in the accompanying Explanatory Memorandum and the Tax information and impact note for reporting non-taxable pension death payments using Real Time Information.

Thank you to those industry representatives who provided feedback on the draft regulations.