Scheme pays: Everything advisers need to know

Annual allowance ‘scheme pays’ – dates for your calendar

clock • 3 min read

Martin Jones shares his technical insight on the scheme pays mechanism and highlights there are two variations which work on different timescales...

Since 2011, pension scheme members have been able to settle annual allowance tax charges via the ‘scheme pays' mechanism. This allows the charge to be paid direct to HM Revenue & Customs (HMRC) from the pension scheme as opposed to being paid via self-assessment. Clients can use this process to settle a charge that's arisen from contributions or accrual in that particular pension scheme. They can also use it to have one scheme pay a charge that arose due to contributions and accrual across more than one scheme. For example, a client could use a defined contribution (DC) scheme like a ...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Pensions

'This time it feels different': What could happen to pensions in the Budget?

'This time it feels different': What could happen to pensions in the Budget?

Rachel Reeves could make significant changes to pension rules

Andrew Tully
clock 23 September 2024 • 4 min read
TISA calls for 'significant reforms' to pensions adequacy

TISA calls for 'significant reforms' to pensions adequacy

Head of retirement says further research and reform needed on AE

Jasmine Urquhart
clock 18 September 2024 • 2 min read
Government to introduce further LTA abolition regulations

Government to introduce further LTA abolition regulations

HMRC says further regulations will be introduced when ‘parliamentary time allows’

Martin Richmond
clock 18 September 2024 • 2 min read