Income Tax (Earnings and Pensions) Act 2003

Unauthorised payments

583 Unauthorised payments

(1) This section applies to a payment if conditions A, B and C are met.

(2) But this section does not apply to a payment to which section 623 applies.

(3) Condition A is that the payment—

(a) is made out of funds which are held for the purposes of an approved retirement benefits scheme (“the paying scheme”), but

(b) is not expressly authorised—

(i) by the rules of the paying scheme, or

(ii) by virtue of paragraph 33 of Schedule 6 to FA 1989.

(4) Condition B is that the payment is not made in the course of payment of a pension or annuity.

(5) Condition C is that the payment is made to or for the benefit of—

(a) an employee, or

(b) an ex-spouse of an employee.

(6) A payment to which this section applies is not to be charged to tax under—

(a) section 598 or 599 of ICTA, or

(b) the Regulations mentioned in paragraph 8 of Schedule 3 to FA 1971.

(7) In this section “payment” includes—

(a) a transfer of assets, and

(b) any other transfer of money’s worth.

584 Taxable pension income

If section 583 applies, the taxable pension income for a tax year is the total amount or value of the payments made in that year.

585 Person liable for tax

If section 583 applies, the person liable for any tax charged under this Part is the person mentioned in condition C in section 583(5) to whom, or for whose benefit, the payment is made.