HMRC publishes update on pensions contracting out

HMRC has published its latest monthly countdown bulletin covering issues for pension scheme administrators related to the ending of contracting out in April 2016

The August issue provides guidance and updates from HRMC and the Department for Work and Pensions on a range of topics.

They include that in previous countdown bulletins, HMRC advised that it had plans for automating ‘not in scheme’ queries where there had been a transfer, buy-out or change of responsible paying authority from the scheme.

HMRC now says that due to the low volume of queries received and the complexity of the automated solution, it has decided not to proceed with the transfer solution at this present time.

However, HMRC says it will continue to explore the feasibility of buy-out and change of responsible paying authority if sufficient queries are received. Pension scheme administrators with have high volumes of this query type from their scheme reconciliation service (SRS) and/or closure output, are asked to advise HMRC of expected volumes and submission dates as soon as possible.

HMRC says the process for raising scheme reconciliation queries has not changed, and in response to queries highlights that it is possible to raise active member and scheme reconciliation queries on the same query template.

In addition, the automated solutions for scheme reconciliation queries can also be used for active member queries. Pension scheme administrators who want to take advantage of the automated solutions should include the same query type on each query template.

 The automation guidance was included in an HMRC email of 24 July sent to its distribution list. This email, which the guidance advises can be requested if needed, gives brief summaries of the re-runnable automated solutions that are available for SRS and closure scan queries.

The latest countdown also clarifies that, in exceptional circumstances only, HMRC will now accept late expressions of interest to register for SRS, contrary to its advice in an earlier bulletin. Countdown bulletin 26 is here.

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