The Registered Pension Schemes (Unauthorised Payments by Existing Schemes) Regulations 2006

• Citation: S.I. 2006/365
• Sections: 2

Section 1 Citation, commencement and interpretation

These Regulations may be cited as the Registered Pension Schemes (Unauthorised Payments by Existing Schemes) Regulations 2006 and shall come into force on 6 th April 2006.

Section 2 Unauthorised member payments not to be scheme chargeable

(1) An unauthorised member payment which—

(a) is made in exercise of the discretion conferred by regulation 3(1) of the Registered Pension Schemes (Modification of the Rules of Existing Schemes) Regulations 2006 , or

(b) would be so made if that regulation applied to the scheme, or

(c) would be so made if—

(i) those regulation applied to the scheme, and

(ii) the payment were made during the transitional period in relation to the scheme,

is a payment of a description prescribed for the purposes of section 241(2) (certain payments not to be scheme chargeable payments), but only to the extent that it is referable to subsisting rights which have accrued under defined benefits arrangements before the commencement day, or to contributions which have been paid to a scheme under money purchase arrangements before that day.

This is subject to the following qualification.

(2) In the case of an unauthorised member payment which comprises or includes a refund of additional voluntary contributions, so much of the refund payment as could have been used to provide pension benefits for the member and his dependants without prejudicing approval of the scheme, before the commencement day, by the Inland Revenue or Her Majesty’s Revenue and Customs is not a payment of a description prescribed for the purposes of section 241(2).

(3) In this regulation—

“the commencement day” means 6 th April 2006;

“existing scheme” means a pension scheme to which paragraph 1(1) of Schedule 36 applies;

“subsisting rights” shall be construed—

in Great Britain, in accordance with section 67A(6) of the Pensions Act 1995 ; and

in Northern Ireland, in accordance with Article 67A(6) of the Pensions (Northern Ireland) Order 1995 ; and

“the transitional period” means the period beginning with the commencement day and ending with the date on which, by virtue of paragraph 3(2) of Schedule 36 , the modifications in Registered Pension Schemes (Modification of the Rules of Existing Schemes) Regulations 2006 cease to have effect; and

a reference (without more) to a numbered provision is a reference to the provision of the Finance Act 2004 bearing that number.

(4) For the purposes of this regulation, whether something would have prejudiced the approval of an existing scheme by the Inland Revenue or by Her Majesty’s Revenue and Customs is to be determined in the case of an occupational pension scheme, in accordance with the publication IR 12(2001) (known as the Occupational Pension Scheme Practice Notes) published by the former Inland Revenue Pension Scheme Office on 23 rd March 2001 as that publication stood immediately before the coming into force of these Regulations.