Things to look out for in the next few months

  • Short service refunds from defined contribution schemes will be prohibited for new joiners who have 30 days or more pensionable service from 1 October 2015.
  • Use of HMRC’s 70/30 rule, whereby employers recovering VAT incurred in respect of costs of investment management activities of a pension scheme are allowed to assume that 30% of the overall fee paid relates to general management with the remaining 70% relating to investment activities, will no longer be permitted after 31 December 2015. 
  • The cut-off date for trustees of defined benefit pension schemes to pass a resolution to preserve the power to pay surplus to the employer expires on 5 April 2016. However, as trustees must give the employer(s) and members at least three months’ notice in writing in advance of the resolution being passed, the cut-off date is effectively earlier.
  • An appeal has been heard against the EAT’s decision in Innospec v Walker that it is permissible for a pension scheme to provide a spouse’s pension to a civil partner in relation to pensionable service accrued on or after 5 December 2005 only. We await the judgment.
  • An appeal against the High Court’s decision in Horton v Henry is due to be heard. The High Court decided that it could not make an income payments order (IPO) in respect of a bankrupt’s pension which was not yet in payment even though the bankrupt might be entitled under rules of the scheme to draw the pension.