HM Revenue and Customs is consulting on draft regulations that aim to ensure that no tax charge arises if a scheme with 20 or more members is winding-up and the scheme pensions are reduced because of financial difficulties.

These draft regulations are in response to concerns that a tax charge may arise in some circumstances if a pension scheme is winding-up and not all the pensions being paid to members are reduced.

These changes would have retrospective effect to 6 April 2006.

The consultation closes on 31 January 2009