HM Revenue and Customs (HMRC) has announced that pension schemes will not be sanctioned for failing to report on the Event Report a payment that would be authorised under the draft Authorised Payment Regulations 2008.
Event Reports are used to report certain events that have occurred relating to the pension scheme during the previous tax year, including unauthorised payments made by the scheme. The deadline for submitting a report was 31 January 2009. Broadly the draft Authorised Payment Regulations 2008 simplify the rules on trivial commutation and allow certain payments made in error to be treated as an unauthorised payment.
HMRC’s announcement confirms that where scheme administrators act in accordance with the draft regulations neither they nor members will be subject to HMRC penalties for failing to act in accordance with existing legislation.
HMRC clarifies that payments that would be authorised under the published version of draft regulations are treated as authorised for the purpose of Event Reports. This is the case even if the payment is unauthorised under current legislation or the final Authorised Payments regulations are different from the published draft.