Guidance

Pension schemes newsletter 130 – June 2021

Published 25 June 2021

1. Extension to some of the temporary changes to pension processes

In Pension schemes newsletter 128 HMRC told you that the temporary changes to some pension processes would be extended until 30 June 2021. These were to help scheme administrators during the coronavirus (COVID-19) pandemic.

We’ve reviewed the temporary changes and are extending the following until 31 October 2021:

• APSS105 relief at source repayment claims
• APSS106 relief at source repayment claims
• APSS590 relief at source declaration
• submitting the APSS107 registered pension schemes annual statistical return without a signature

All other temporary changes listed in pension schemes newsletters 118, 119, 120, 121 and 124 will end on 30 June 2021 as expected.

We’ll keep you updated on any further changes in future pension schemes newsletters.

2. Managing the Pension Schemes service

2.1 Retirement annuity contracts (RACs) and deferred annuity contracts (DACs)

In mid-August 2021, we’ll introduce a feature for pension scheme administrators to declare themselves as scheme administrators for RACs and DACs on the Managing Pension Schemes service. Once this functionality becomes available, you’ll no longer be able to do this on the Pension Schemes Online service.

We’ll provide more information on this release in a future newsletter.

2.2 Pension scheme migration

In our Managing pension schemes newsletter – March 2021 we updated you on how pension scheme migration will work and the steps you may need to take.

We included information on what you need to do if you:

• have multiple scheme administrator or practitioner IDs
• have pre-A day pension schemes which you do not currently have access to
• want information on how to enrol for the Managing Pension Schemes service
• want guidance on the pension scheme information required when migrating a pension scheme

We’ve also updated the guidance Manage a registered pension scheme and Find out about the pension scheme practitioner role. They now include how to enrol for the Managing Pension Schemes service.

If you’re an existing scheme administrator and have already enrolled on the Managing Pension Schemes service, but have received an administrator ID beginning ‘A2’, we’ll need to work with you to correct this. To discuss this, email migration.mps@hmrc.gov.uk and put ‘incorrect enrolment’ in the title.

2.3 Pension scheme migration – scheme establishers

If you have any questions about providing establisher details for a registered pension scheme for migration, email migration.mps@hmrc.gov.uk with the following information:

• the pension scheme name
• your pension scheme tax reference
• your scheme administrator ID
• details of the pension scheme establisher query

3. Signing in to online services

HMRC has started an ongoing programme of deleting credentials (user ID and password) for users who have not signed in to a service for 3 years.

If you’re a pension scheme administrator or pension scheme practitioner and you’ve not signed in to the following services for a while, you’ll need to log in to your Business Tax Account as soon as you can for your credentials to remain active:

• the Pension Schemes Online service
• the Managing Pension Schemes service
• another tax services

If your credentials have been deleted, you can find guidance on how to restore your access to the Pension Schemes Online service in section 1.4 of the Pension schemes online: user guide.

Once you’ve done this, you’ll keep the same scheme administrator or practitioner ID and access to your pension schemes.

4. Self-invested personal pensions (SIPP) and small self-administered scheme (SSAS) pensions – connected tenants

4.1 Rent and loan payment holidays

We know that (due to COVID-19) some scheme administrators may want to provide increased numbers of payment holidays on loans and rents, due from connected parties on commercial properties held in registered pension schemes.

Scheme administrators are still required to make sure:

• a payment holiday is on a commercial basis
• a payment holiday does not result in an unauthorised payment charge
• they base all decisions on independent supporting evidence

Scheme administrators should ask connected tenants to provide a formal request for deferral, including evidence of hardship and any other concessions to expenditure being sought. This may need to be confirmed by an independent party (accountant), with evidence of the tenant’s financial position and proposals for paying future rents and clearing any arrears. The proposal should then be formally considered by the trustees and the decision recorded.

Where a payment holiday is permitted, the connected parties should be made aware of the potential tax implications if arm’s length terms are not adhered to. Scheme administrators should do ongoing reviews of the situation.

4.2 Re-negotiating leases

Any renegotiation of a lease must be on commercial terms. We’d expect scheme administrators to keep evidence to show that their dealings with connected tenants are conducted in the same way as they would deal with unconnected tenants.

If we ask for details of a transaction between a pension scheme and a connected tenant, scheme administrators should be able to show they’ve taken steps to make sure they’ve acted in the best interests of scheme members.