Finance Act 2004

1 (1) For the purposes of the member payment charges the member payment provisions apply in relation to payments made (or treated by this Part as made) to or in respect of— U.K.

(a) a relieved member of a relevant non-UK scheme, or

(b) a transfer member of such a scheme,

as in relation to payments made (or treated by this Part as made) to or in respect of a member of a registered pension scheme.

(2) Sub-paragraph (1) has effect subject to the provision made by and under paragraphs 2 to 7.

(3) “The member payment charges” are—

(a) the unauthorised payments charge [F1 (except as imposed by virtue of section 174A (taxable property held by investment-regulated pension schemes))],

(b) the unauthorised payments surcharge,

(c) the short service refund lump sum charge,

F2 (ca) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(d) the special lump sum death benefits charge,

[F3 (da) the charges under section 636A(1A) and (1B) of ITEPA 2003 (uncrystallised funds pension lump sums),]

[F4 (db) the charge under section 636A(4ZA) of ITEPA 2003 (certain payments of lump sum death benefits),]and

(e) the charges under sections 636B and 636C of ITEPA 2003 (trivial commutation and winding-up lump sums and lump sum death benefits) (inserted by Schedule 31).

(4) “The member payment provisions” are[F5 —

(a)] the provisions of this Part [F6 (apart from the taxable property provisions)] relating to payments made (or treated by this Part as made) to or in respect of a member of a registered pension scheme[F7 , and

(b) section 636A(1A) to (1C) [F8 and (4ZA) and section 636AA] of ITEPA 2003.]

(5) A scheme is a relevant non-UK scheme if—

(a) relief from tax has been given in respect of contributions paid under the scheme by virtue of Schedule 33 (overseas pension schemes: migrant member relief),

(b) relief from tax has been so given at any time after 5th April 2006 under double tax arrangements,

(c) a member of the scheme has been, or members of the scheme have been, exempt from liability to tax by virtue of section 307 of ITEPA 2003 (exemption for provision made by employer for retirement or death benefit) in respect of provision made under the scheme at any time after 5th April 2006 when the scheme was an overseas pension scheme, or

(d) there has been a relevant transfer at any time after 5th April 2006 when the scheme was a qualifying recognised overseas pension scheme.

(6) “A relevant transfer” means a (direct or indirect) transfer of sums or assets held for the purposes of, or representing accrued rights under, an arrangement made under—

(a) a registered pension scheme, or

(b) another scheme which is a relevant non-UK scheme,

in relation to a member so as to become held for the purposes of, or to represent rights under, an arrangement under the scheme relating to the member; F9 ...

[F10 (6A) There are three types of relevant transfer—

(a) an original relevant transfer,

(b) a subsequent relevant transfer, and

(c) any other (including, in particular, all relevant transfers before 9 March 2017).

(6B) “An original relevant transfer” is—

(a) a relevant transfer within sub-paragraph (6)(a) made on or after 9 March 2017,

(b) a relevant transfer within sub-paragraph (6)(b), made on or after 9 March 2017, of the whole or part of the UK tax-relieved fund of a relieved member of a qualifying recognised overseas pension scheme, or

(c) a relevant transfer within sub-paragraph (6)(b), made on or after 6 April 2017, of the whole or part of the UK tax-relieved fund of a relieved member of a relevant non-UK scheme that is not a qualifying recognised overseas pension scheme.

(6C) The sums or assets transferred as a result of an original relevant transfer constitute a ring-fenced transfer fund, and the key date for that fund is the date of the transfer.

(6D) Where in the case of a ring-fenced transfer fund (“the source fund”) there is a relevant transfer of the whole or part of the fund—

(a) the sums or assets transferred as a result of the transfer constitute a ring-fenced transfer fund,

(b) that fund has the same key date as the source fund, and

(c) the transfer is “a subsequent relevant transfer”, and is not an original relevant transfer.

(6E) Sub-paragraph (6D) applies whether the source fund is a ring-fenced transfer fund as a result of sub-paragraph (6C) or as a result of sub-paragraph (6D).

(6F) The Commissioners for Her Majesty's Revenue and Customs may by regulations provide that sums or assets identified in accordance with the regulations are not included in a ring-fenced transfer fund as a result of sub-paragraph (6C) or (6D)(a).]

(7) A member of a relevant non-UK scheme is a relieved member of the scheme if—

(a) any of the contributions in respect of which relief has been given as mentioned in sub-paragraph (5)(a) or (b) were contributions paid by or on behalf of, or in respect of, the member, or

(b) the member is the member, or one of the members, who has been exempt from liability to tax as mentioned in sub-paragraph (5)(c).

(8) A member of a relevant non-UK scheme is a transfer member of the scheme if a relevant transfer related to the member.

Textual Amendments

F1 Words in Sch. 34 para. 1(3)(a) inserted (retrospective to 6.4.2006) by Finance Act 2006 (c. 25), s. 158(2), Sch. 21 para. 14(2)(a)

F2 Sch. 34 para. 1(3)(ca) omitted (with effect in accordance with Sch. 5 para. 4 of the amending Act) by virtue of Finance Act 2016 (c. 24), Sch. 5 para. 3(1)(d)(i)

F3 Sch. 34 para. 1(3)(da) inserted (17.12.2014) by Taxation of Pensions Act 2014 (c. 30), Sch. 1 para. 95(2)

F4 Sch. 34 para. 1(3)(db) inserted (with effect in accordance with s. 22(12) of the amending Act) by Finance (No. 2) Act 2015 (c. 33), s. 22(10)(a)

F5 Words in Sch. 34 para. 1(4) inserted (17.12.2014) by Taxation of Pensions Act 2014 (c. 30), Sch. 1 para. 95(3)(a)

F6 Words in Sch. 34 para. 1(4) inserted (retrospective to 6.4.2006) by Finance Act 2006 (c. 25), s. 158(2), Sch. 21 para. 14(2)(b)

F7 Sch. 34 para. 1(4)(b) and preceding word inserted (17.12.2014) by Taxation of Pensions Act 2014 (c. 30), Sch. 1 para. 95(3)(b)

F8 Words in Sch. 34 para. 1(4)(b) inserted (with effect in accordance with s. 22(12) of the amending Act) by Finance (No. 2) Act 2015 (c. 33), s. 22(10)(b)

F9 Words in Sch. 34 para. 1(6) repealed (19.7.2007) (with effect in accordance with Sch. 19 para. 29(3) of the amending Act) by Finance Act 2007 (c. 11), Sch. 19 para. 18(2), Sch. 27 Pt. 3(1)

F10 Sch. 34 para. 1(6A)-(6F) inserted (retrospective to 9.3.2017) by Finance Act 2017 (c. 10), Sch. 4 paras. 2(2), 8

Modifications etc. (not altering text)

C1 Sch. 34 modified (6.4.2006) by The Pensions Schemes (Application of UK Provisions to Relevant Non-UK Schemes) Regulations 2006 (S.I. 2006/207), regs. 1(1), 17

Commencement Information

I1 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284