C4C11C12C9C8C2C6C5C3C10Part 4Pension schemes etc

Annotations:
Modifications etc. (not altering text)
C6

Pt. 4 modified (1.7.2008) (N.I.) (with effect in accordance with reg. 1 of the amending Rule) by The Health and Social Care (Pension Scheme) Regulations (Northern Ireland) 2008 (S.R. 2008/256), regs. 1, 124(1) (with regs. 134, 258)

C3

Pt. 4 applied (21.7.2009) by Finance Act 2009 (c. 10), Sch. 35 para. 18

C10

Pt. 4 modified (19.7.2011) by Finance Act 2011 (c. 11), Sch. 18 para. 14(3)

C3C10Chapter 5Registered pension schemes: tax charges

Charges on authorised payments

I1C1C7205Short service refund lump sum charge

1

A charge to income tax, to be known as the short service refund lump sum charge, arises where a short service refund lump sum is paid by a registered pension scheme.

2

The person liable to the short service refund lump sum charge is the scheme administrator.

3

The scheme administrator is liable to the short service refund lump sum charge whether or not—

a

the scheme administrator, and

b

the person to whom the short service refund lump sum is paid,

are resident, ordinarily resident or domiciled in the United Kingdom.

4

The rate of the charge is—

a

20% in respect of so much of the lump sum as does not exceed £10,800, and

b

40% in respect of so much (if any) of it as exceeds that limit.

5

The Treasury may by order amend subsection (4) so as to—

a

increase or decrease either or both of the rates for the time being specified in that subsection, or

b

increase the limit for the time being specified in paragraph (a) of that subsection.

6

Tax under this section is to be charged on the amount of the lump sum paid or, if the rules of the pension scheme permit the scheme administrator to deduct the tax before payment, on the amount of the lump sum before deduction of tax.

7

A short service refund lump sum is not to be treated as income for any purpose of the Tax Acts.