PTM166200 - Information and administration: information requirements when a member flexibly accesses their benefits: information the scheme administrator must provide to a member when they flexibly access benefits
Glossary PTM000001
When the scheme administrator must provide a flexible-access statement
When the scheme administrator doesn’t have to provide a flexible access statement
What the flexible access statement must contain
Regulation 14ZA The Registered Pension Schemes (Provision of Information) Regulations 2006 - SI 2006/567
When the scheme administrator must provide a flexible-access statement
The scheme administrator must give the member a flexible access statement within 31 days beginning with the date of one of the following ‘relevant events’:
- a qualifying payment is made from a flexi-access drawdown fund created from uncrystallised funds designated into drawdown on or after 6 April 2015
- a qualifying payment is made from funds designated into a flexi-access drawdown fund as a result of a transfer - see PTM104000
- where a payment is made from a capped drawdown pension fund that is more than the annual capped drawdown limit and so converts the fund into flexi-access drawdown
- the payment of an uncrystallised funds pension lump sum
- the payment of a stand-alone lump sum on or after 6 April 2015 from a money purchase arrangement to a member who has primary protection with protected lump sums of more than £375,000 - see PTM063110
- the first payment of an annuity from a flexible lifetime annuity contract - see PTM056520
- the first payment of a scheme pension under a money purchase arrangement to which the member became entitled on or after 6 April 2015 and at that time less than 11 other individuals had become entitled to the payment of a scheme pension or dependants’ scheme pension under the same scheme. (This does not apply if the scheme is a deferred annuity contract.)
A ‘qualifying payment’ is a payment of either income withdrawal or short-term annuity.
Where the whole flexi-access drawdown fund is made up of rights attributable to a disqualifying pension credit, the payment from the fund is not a ‘relevant event’ and so no flexible access statement is required. A disqualifying pension credit is a pension credit that derives from crystallised funds.
When the scheme administrator doesn’t have to provide a flexible access statement
The scheme administrator does not have to give the member a flexible access statement in the following circumstances:
- they have already given the member a flexible access statement in relation to an earlier ‘relevant event’ under the scheme
- the member has told them that they have previously flexibly accessed their pension rights
- another scheme administrator has told them that the member has already flexibly accessed their pension rights.
What the flexible access statement must contain
HMRC is not prescriptive about the precise wording of the information given to the member on the flexible access statement. However it must contain certain information.
Tax years 2017-18 onwards
Flexible access statements issued during tax years 2017-18 onwards must provide the following information; that:
- the member has flexibly accessed their pension savings and the date of the relevant event
- if in any tax year the member’s total pension inputs into money purchase arrangements and certain hybrid arrangements is more than £4,000:
- they will be liable to an annual allowance charge on the excess amount over £4,000, and
- their annual allowance for pension inputs under other types of arrangements will be reduced by £4,000
- the member has a duty to pass on information to other pension schemes describing the circumstances in which the member must pass on that information, what information has to be passed on and the relevant time limits. (PTM166400 provides guidance on when a member must pass on information about receiving a flexible access statement.)
Tax years 2015-16 and 2016-17
The information that must be provided in flexible access statements issued during tax years 2015-16 and 2016-17 is the same as described immediately above for statements issued during tax years 2017-18 onwards, except that each reference to ‘£4,000’ is replaced with ‘£10,000’.