7 Days is a weekly round up of developments in pensions, normally published on Monday mornings. We collate this information from key industry sources, such as the DWP, HMRC and TPR.

In this 7 Days

DWP consults on conditions for surplus release

On 10 June 2026, the DWP published a consultation on the draft Occupational Pension Schemes (Payments to Employer) Regulations 2027 (“the Regulations”), as well as an illustrative surplus journey highlighting the typical stages trustees and employers are likely to follow when considering a surplus release.

The Regulations set out the conditions and “clear safeguards” that will need to be satisfied before surplus can be released from a DB scheme on an ongoing basis, aiming to “strike the right balance between strong protection for members and appropriate flexibility for trustees”. With a view to bringing the Regulations into force in April 2027 (much earlier than anticipated), the consultation closes on 2 September 2026.

HMRC is expected to consult separately on changes to tax legislation to enable direct surplus payments to members to be treated as authorised payments where certain conditions are met. Those conditions will include the need for the scheme to meet the required (low dependency) funding threshold and that payments can only be made to members who have reached NMPA. Trustees will also be able to award authorised member surplus payments to members yet to reach that point, but payment must be deferred until NMPA.

TPR intends to consult later this year on guidance outlining the factors trustees should consider when releasing surplus and how to comply with the Regulations. In the interim, it has published a statement designed to support discussions between trustees and employers, including some high-level examples of how trustees could approach surplus release now (subject to their scheme’s trust deed and rules), and how this could change when new legislation is introduced. See our Alert for further detail.

The FRC has announced that it will develop technical actuarial guidance to help scheme actuaries certify that surplus payments to employers meet the legislative requirements.

DWP consults on changes to the conditions for transfers regulations

On 9 June 2026, the DWP published a consultation on proposals to amend the Occupational and Personal Pension Schemes (Conditions for Transfers) Regulations 2021 (the “Regulations”). Following the Government’s review of the Regulations in 2023, the proposed changes are intended to “target genuine risks more precisely” by “removing unnecessary friction without weakening safeguards”. They include removing the current amber flag in relation to overseas investments and enabling trustees to make a transfer without engaging an additional level of due diligence where they are satisfied that the receiving scheme is “reputable”.

The consultation closes on 21 July 2026. Later in 2026, the Government intends to explore wider pension transfer issues, such as how processes can be modernised and how savers who choose to transfer their pensions are enabled to make well informed decisions while maintaining robust protections. See our Alert for further detail.

HMRC consults on legislation to address GMP conversion annual allowance issues

On 8 June 2026, HMRC published for technical consultation draft legislation to change how the annual allowance is calculated where schemes use the statutory facility to convert GMPs into ordinary benefits. This is intended to prevent unexpected annual allowance tax charges arising when schemes use GMP conversion to carry out GMP equalisation, and to help ensure that members do not “face a worse tax outcome simply because of the method chosen to equalise benefits”.

The consultation closes on 13 July 2026, with the change expected to take effect from the start of the 2027/28 tax year.

HMRC updates guidance on VAT deduction on pension fund management costs

In June 2025, HMRC published a policy paper announcing a change to VAT deduction on the management of pension funds. From 18 June 2025, employers were able to deduct input tax in full (subject to any partial exemption restrictions in place) on costs that they incur in relation to funded occupational pension schemes. Trustees can also deduct input tax to the extent that they are VAT-registered and make onward supplies to the employer.

Various pages of HMRC’s VAT Input Tax manual have now been updated to outline the policy in more detail and how HMRC considers it should be applied by employers and trustees. This includes updated guidance on the effect on trustees of funded occupational pension schemes.

TPR finalises guidance on the Virgin Media remedy

On 8 June 2026, TPR updated its guidance on the Virgin Media remedy with minor changes to reflect the final legislation in the Pension Schemes Act 2026. See our Hot Topic for further detail of the remedy and TPR’s guidance.

PPI report on guided retirement

On 8 June 2026, the PPI published a report exploring the development of guided retirement under the framework established by the Pension Schemes Act 2026 and the role it could play in supporting individuals as they convert pension savings into retirement income.

The report explores the current challenges in decumulation, highlighting that guided retirement “sits within a wider and evolving retirement support landscape” and its effectiveness “will be shaped by how it interacts with existing and emerging forms of support, including Pension Wise, targeted support, and regulated financial advice”.