xmlns:atom="http://www.w3.org/2005/Atom" xmlns:atom="http://www.w3.org/2005/Atom"

Recognised overseas pension schemes: prescribed countries or territories and prescribed [F1requirements] U.K.

3.—(1) For the purposes of section 150(8) (recognised overseas pension schemes), in addition to satisfying the requirements set out in regulation 2 above, [F2the pension scheme must satisfy—

(a)the requirement in paragraph (6); and

(b)one or more of the following requirements—

(i)the requirement that the scheme must be established in a country or territory mentioned in paragraph (2),

(ii)the requirement in paragraph (4),

(iii)the requirement in paragraph (5).]

(2) The countries and territories referred to in [F3paragraph (1)(b)(i)] are—

(a)the member States of [F4the European Union], other than the United Kingdom;

(b)Iceland, Liechtenstein and Norway; and

(c)any country or territory[F5, other than New Zealand,] in respect of which there is in force an Order in Council under section 788 of the Income and Corporation Taxes Act 1988 M1 giving effect in the United Kingdom to an agreement which contains provision about—

(i)the exchange of information between the parties, and

(ii)non-discrimination.

(3) For the purposes of paragraph (2)(c)(ii) an agreement “contains provision about non-discrimination” if it provides that the nationals of a Contracting State shall not be subjected in the territory of the other Contracting State to any taxation, or any requirement connected to such taxation, which is other than, or more burdensome than, the taxation and connected requirements to which the nationals of the other State are or may be subjected in the same circumstances.

[F6(4) At the time of a transfer of sums or assets which would, subject to these Regulations, constitute a recognised transfer, a pension scheme must satisfy the condition in paragraph (4A) and the rules of that scheme must provide that—

(a)at least 70% of the sums transferred will be designated by the scheme manager for the purpose of providing the member with an income for life;

(b)the pension benefits (and any lump sum associated with those benefits) payable to the member under the scheme, to the extent that they relate to the transfer, are payable no earlier than they would be if pension rule 1 in section 165 applied; and

(c)the scheme is open to persons resident in the country or territory in which it is established.

(4A) Where the pension scheme—

(a)is established in Guernsey, and

(b)is an exempt pension contract or an exempt pension trust within the meaning of section 157E of the Income Tax (Guernsey) Law, 1975,]

the scheme must not be open to non-residents of Guernsey.

[F7(5) At the time of a transfer of sums or assets which would, subject to these Regulations, constitute a recognised transfer the scheme must be of a kind specified in Schedule 2 to these Regulations.

(6) Where tax relief in respect of benefits paid from the scheme is available to a member of the scheme who is not resident in the country or territory in which the scheme is established, the same or substantially the same tax relief must—

(a)also be available to members of the scheme who are resident in the country or territory; and

(b)apply regardless of whether the member was resident in the country or territory—

(i)when the member joined the scheme; or

(ii)for any period of time when they were a member of the scheme.

(7) For the purposes of paragraph (6) “tax relief”—

(a)is any tax relief that is available under the system of taxation of personal income in the country or territory in which the scheme is established; and

(b)includes the grant of an exemption from tax other than an exemption which applies by virtue of double taxation arrangements.

(8) In paragraph (7)(b) “double taxation arrangements” means arrangements made between the country or territory in which the scheme is established and another country or territory with a view to affording relief from double taxation.]

Textual Amendments

Marginal Citations

M11988 c. 1. Section 788 has been amended by paragraphs 1 and 2 of Schedule 30, and the relevant entry in Part II (13) of Schedule 40 to the Finance Act 2000 (c. 17), section 88 of the Finance Act 2002 (c. 23) and section 198 of the Finance Act 2003 (c. 14).