Part 4U.K.Pension schemes etc

Modifications etc. (not altering text)

C7Pt. 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)

C8Pt. 4 modified by The Taxation of Pension Schemes (Transitional Provisions) Order 2006 (S.I. 2006/572), reg. 5A (as inserted (6.4.2006) by S.I. 2008/2990, arts. 1(1), 3)

C9Pt. 4 applied (21.7.2009) by Finance Act 2009 (c. 10), Sch. 35 para. 18

C10Pt. 4 modified (19.7.2011) by Finance Act 2011 (c. 11), Sch. 18 para. 14(3)

C11Pt. 4 applied (with modifications) (with application in accordance with Sch. 22 para. 1 of the amending Act) by Finance Act 2013 (c. 29), Sch. 22 para. 1(2)

C12Pt. 4 modified (17.7.2014) by Finance Act 2014 (c. 26), Sch. 6 para. 1(2)(3)

C13Pt. 4: power to amend conferred (17.12.2014) by Taxation of Pensions Act 2014 (c. 30), s. 4(3)

C14Pt. 4 modified (15.9.2016) by Finance Act 2016 (c. 24), Sch. 4 para. 1

C15Pt. 4 modified (15.9.2016) by Finance Act 2016 (c. 24), Sch. 4 para. 9(2)

Chapter 5U.K.Registered pension schemes: tax charges

Annual allowance chargeU.K.

[F1227DPension input amounts in respect of certain hybrid arrangementsU.K.

(1)In this section “relevant hybrid arrangement” means a hybrid arrangement—

(a)relating to the individual under a registered pension scheme of which the individual is a member,

(b)made on or after 14 October 2014 or having become a hybrid arrangement (whether or not for the first time) on or after that day, and

(c)in respect of which the pension input amount is input amount C mentioned in section 237.

(2)As respects each relevant hybrid arrangement in the maximising set of relevant hybrid arrangements—

(a)the pension input amount in respect of the arrangement is for the purposes of sections 227B(3)(b) and 227C(1)(b) treated as being not input amount C mentioned in section 237 but, instead, the greater of such of input amounts A and B mentioned in section 237 as are, for the purposes of section 237, relevant input amounts in the case of the arrangement, and

(b)accordingly, the arrangement—

(i)is not to be included among the arrangements mentioned in section 227B(3)(b) whose pension input amounts are totalled under section 227B(3), but

(ii)is to be included among the arrangements mentioned in section 227C(1)(b) whose pension input amounts are totalled under section 227C(1).

(3)For the purposes of subsection (2)—

(a)the maximising set contains no relevant hybrid arrangements,

(b)a particular relevant hybrid arrangement makes up that set, or

(c)two or more particular relevant hybrid arrangements make up that set,

if the alternative chargeable amount with the maximising set so made up is not less than it would be with the maximising set made up in any other way.

(4)In particular, the maximising set may be identified by taking the following steps—

Step 1 Identify all of the relevant hybrid arrangements.
Step 2 Identify all of the different combinations of the arrangements identified at Step 1 (including the combination consisting of all of those arrangements, and the combination consisting of none of them, as well as every possible combination of each possible size in between).
Step 3 For each combination identified at Step 2 calculate what the money-purchase input sub-total would be if each relevant hybrid arrangement in the combination were treated in accordance with the rules in paragraphs (a) and (b) of subsection (2).
Step 4 If the result of each calculation at Step 3 is less than or equal to [F2£4,000] the chargeable amount is the default chargeable amount.
Step 5 If the amount calculated at Step 3 for a combination is greater than [F2£4,000] then calculate in accordance with section 227B what the alternative chargeable amount would be if—
(a)
each relevant hybrid arrangement in the combination were treated in accordance with the rules in paragraphs (a) and (b) of subsection (2), and
(b)
for each relevant hybrid arrangement not in the combination, input amount C mentioned in section 237 were included in the total under section 227B(3).
Step 6 Identify the highest (or higher) of the amounts calculated at Step 5. The maximising set is made up of each relevant hybrid arrangement in the combination concerned.

(5)Subsection (1)(c) is to be read with section 227B(5) (hybrid arrangements where input amount C is highest-equal input amount).

F3(6). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]

Textual Amendments

F1Ss. 227B-227G inserted (17.12.2014) (with effect in accordance with Sch. 1 para. 65(2) of the amending Act) by Taxation of Pensions Act 2014 (c. 30), Sch. 1 para. 65(1)

F2Word in s. 227D(4) substituted (with effect in accordance with s. 7(5) of the amending Act) by Finance (No. 2) Act 2017 (c. 32), s. 7(4)

F3S. 227D(6) omitted (with effect in accordance with Sch. 4 para. 4(3) of the amending Act) by virtue of Finance (No. 2) Act 2015 (c. 33), Sch. 4 para. 4(2)(d)