7 Days is a weekly round up of developments in pensions, normally published on Monday afternoons. We collate this information from key industry sources, such as the DWP, HMRC and TPR.
In this 7 Days
- HMRC issues pension schemes newsletter 115
- PASA Master Trust Transition Guidance
- TPR guidance on complying with investment governance duties
On 26 November 2019, HMRC issued pension schemes newsletter 115. It includes information on:
- how to report details of those scheme members who have relied on more recent lifetime allowance protections for 2019-20
- using the Managing Pensions Schemes Service
- notification of residency status reports for 2020-21 which should be received by relief at source pension schemes in January 2020, to allow them to apply the correct rate of tax relief to scheme members. The newsletter includes information on what a scheme should do if it doesn’t receive a report
- a request for scheme administrators to remind members who have exceeded their annual allowance for 2018 to 2019 and who do not have sufficient unused annual allowance to carry forward to cover the excess, that they must declare this on their Self Assessment tax return, even if their scheme is paying the tax charge.
On 26 November 2019, PASA’s Master Trust Transition Working Group published new guidance on DC master trust transition. It intends to provide guidance and instructions for all stakeholders involved in the administration processes for transitions of members to and from DC master trusts. The guidance focuses on the two most common transition scenarios:
- from master trust to master trust where “Continuity Option One” is being followed (where trustees are required by legislation to transfer out all of their members and wind up their scheme)
- from single employer DC trusts to master trust.
TPR has produced guidance aimed at helping trustees to meet their duties when they are working with providers of investment consultancy and fiduciary management services. This is in line with the new duties for trustees and managers of occupational pension schemes introduced by the CMA, which will take effect from 10 December 2019 (see our Alert).
The guidance is separated into four topics:
- “Choose an investment governance model” – aims to support trustees in understanding their investment governance capability, setting investment beliefs and objectives, and highlights other key matters to consider when deciding on an investment governance model
- “Tender for fiduciary management services” – intended to provide trustees with practical information and key matters to consider when putting together a competitive tender exercise to appoint a fiduciary manager
- “Tender for investment consultancy services” – sets out suggested key considerations and principles when running a tendering process for investment consultancy
- “Set objectives for your investment consultant” – suggests matters to consider when setting objectives and monitoring performance, and includes case studies to illustrate how this might be applied by DB and DC schemes.