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My PFS - Technical news - 17/02/2015

Publication date:

17 February 2015

Last updated:

06 July 2018


Technical Connection

Personal Finance Society news update from 28 January 2015 - 10 February 2015, covering Taxation, Investments, and Retirement Planning.

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Taxation and Trusts

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Taxation and trusts

General Anti-Abuse Rule

(RO3, AF1)

HMRC has updated its guidance notes on the General Anti-Abuse Rule (GAAR). The updated guidance is effective for transactions entered into on or after 30 January 2015. The changes simply clarify the guidance - there is no change in the law or HMRC's interpretation of it.

The GAAR sets out which tax arrangements are abusive under the legislation.

Strengthening sanctions for tax avoidance

(RO3, AF1)

HMRC has published a consultation paper, 'Strengthening Sanctions for Tax Avoidance', setting out proposals to tackle the serial use of tax avoidance schemes.

Those who enter into tax avoidance schemes already face penalties. However, this consultation proposes additional financial costs, such as a surcharge and additional reporting requirements on users of multiple schemes that fail. The consultation therefore seeks views on which are the most appropriate methods of tackling persistent avoiders, and how these ought to be developed.

The consultation also considers whether, and how, to introduce additional penalties in cases where the General Anti-Abuse Rule (GAAR) applies. The consultation period runs until 12 March 2015.

Scottish property tax changes

(AF1, RO3)

The recently announced proposed changes by Finance Secretary, John Swinney, in the Scottish Parliament, mean that the Land and Buildings Transaction Tax (LBTT) (if agreed) will be lower for those buying properties at average Scottish prices than initially proposed in the Draft Budget 2015/2016. The proposed rates are to apply from 1 April 2015.

If these changes go ahead, house buyers in Scotland at the low to middle end of the scale will benefit from the revised rates for the new LBTT, but those buying more expensive properties will still pay far more than under Stamp Duty Land Tax (SDLT).

The Scottish tax rates and bands remain subject to Parliamentary scrutiny and approval. It is likely that the Scottish government will seek Parliament's approval of rate setting orders which will be laid in Parliament in early February.

In the meantime, if these rates and bands are agreed the position for the UK and Scotland will be as follows:

UK  (applicable from 4 December 2014)

Scotland (from 1 April 2015 if agreed)





Up to £125,000


Up to £135,000


£125,000 - £250,000


£135,000 - £250,000


£250,000 - £925,000




£925,000 - £1,500,000


£250,000 - £1,000,000


Over £1,500,000


Over £1,000,000


HMRC clampdown on footballers

(AF1, RO3)

Around 140 footballers, some of whom are recently retired Premier League players, face financial difficulty due to HMRC demands for disputed tax relief from various investment schemes.

According to The Guardian, around 100 players have sought help from their union, 'The Professional Footballers' Association.' The welfare organisation for former players, 'Xpro,' is representing an additional 40 players in an effort to deal with the taxman's demands.

Xpro chief executive, Geoff Scott, told the paper that all 40 players are seriously affected by HMRC demands for the repayment of tax reliefs on various investment schemes, with around 20 facing bankruptcy and potential homelessness.

Broadly, HMRC has challenged a number of schemes in an attempt to crack down on tax avoidance and has also published a list of suspected tax avoidance schemes. Those investors who had not settled with HMRC were sent an accelerated payment notice which ordered them to pay the disputed tax within 90 days before HMRC challenges the particular scheme in Court. The press named and shamed some of the celebrity footballers who entered into the popular film schemes but, according to The Guardian, a number of lower-paid footballers have also entered into such schemes and are struggling to pay the disputed tax to HMRC.

Loan trusts and the new IHT rules on multiple settlements

(AF1, AF2, RO3, JO2)

The new rules on multiple settlements are designed predominantly to catch a popular will planning strategy where a substantial gift is made on death across a series of lifetime 'pilot' trusts. However, closer inspection of the provision reveals that there are limited situations where loan trust arrangements created during lifetime could be brought within the scope of the new rules on the settlor's death.

We have recently had cause to consider the likely purpose of the second limb of the new section 62A IHTA 1984 which is contained in section 62A(2). In some circumstances this could have some relevance to loan trusts created without any initial gift. The relevant part of the section reads as follows:

"62A Same-day additions

(1) For the purposes of this Chapter, there is a 'same-day addition', in relation to a settlement ('settlement A'), if:

(a) there is a transfer of value by a person as a result of which the value immediately afterwards of the property comprised in settlement A is greater than the value immediately before, 

(b) as a result of the same transfer of value, or as a result of another transfer of value made by that person on the same day, the value immediately afterwards of the property comprised in another settlement ('settlement B') is greater than the value immediately before, and 

(c) that person is the settlor of settlements A and B, 

and references to the value of the same-day addition are to the difference between the two values mentioned in paragraph (b).

(2) The transfer or transfers of value mentioned in subsection (1) include a transfer or transfers of value as a result of which property first becomes comprised in settlement A or settlement B; but not if settlements A and B are related settlements."

We came to the conclusion that subsection (2) of the new section is unlikely to have any bearing on loan trusts in any circumstances (it is only relevant where the addition results in property 'first becoming comprised' in the settlement and, in the case of a loan trust, property would be 'comprised in the settlement' before any addition by reason of the growth on the investment if nothing else. However, consideration of subsection (2) has highlighted a possible application of subsection (1) to loan trust arrangements where the loan is waived on death.

A loan trust arrangement typically involves the settlor making an interest-free loan to trustees, which is repayable on demand and which the trustees then invest in an investment bond. The loan remains part of the settlor's estate (for both inheritance tax and succession purposes) to the extent that it is not repaid; while any investment growth is held outside the estate for the benefit of the trust beneficiaries.

In the event of the settlor's death, any outstanding loan should theoretically be paid to the settlor's estate to be distributed in accordance with the settlor's Will. This can be avoided by the settlor making provision in their Will for loan repayments to continue to another beneficiary - say a spouse. The beneficiary then controls the amount and timing of future loan repayments. If such provision is not made, the loan will need to be repaid and this will necessitate an encashment (or partial encashment) of the bond by the trustees. Not only is this likely to trigger a chargeable event and an income tax charge at the trustees' or settlor's rate; there may be early surrender penalties as well as additional costs of reinvestment if the trustees are not ready to distribute the balance of the investment (perhaps because the intended beneficiaries of the trust are still minors).

A number of loan trust providers have suggested a solution to this problem in the form of a provision inserted into the Will which waives any outstanding loan balance in favour of the trust. The waiver represents an addition to the trust which is made by the settlor/testator on the date of their death. This will be a transfer of value which, because it is made on death, will be a chargeable transfer.

In isolation, this is not an issue as the new section 62A will only be relevant where the addition falls within the definition of a 'same-day addition' (this broadly requires there to be two or more trusts each of which are increased in value on the same day). However, where the initial investment into the loan trust has been spread across two or more trusts created on consecutive dates to obtain the benefit of multiple nil rate bands, and the settlor then includes a provision in their Will waiving both/all the outstanding loans on death, section 62A(1)  will be in point.

The issue could also arise where there is just one loan trust (and one loan that is waived on death) if there is also another lifetime trust (e.g. a bypass trust) that is also added to by the Will.

Our opinion is that section 62A(2) is probably designed to catch lifetime pilot trust arrangements set up on different days where the trusts are set up with no initial property. This is an alternative approach to the usual position (where the trusts are created with a nominal sum) that is taken by a number of law firms on the basis of Opinion from leading Counsel that the trusts are still valid even if there is no initial property in them.

Loan trusts, and other life policy trust arrangements, will typically be unaffected by the new rules. However, it is interesting to see that there could be some indirect situations where the provision has significance. Where advisers are recommending two or more loan trusts to the same settlor, it will be important to avoid waiving the loans at the same point (whether on lifetime or on death under a provision in the Will). Alternative options might include leaving the right to repayment of one or more of the loans to a surviving spouse.

Even if just one loan trust is being created, if any outstanding loan balance is to be waived on death, it will be important to check the provisions of the Will to ensure that it contains no provisions for gifts to other trusts created by the same settlor during their lifetime.

Fair Tax Mark available for "Open" taxpaying companies

(AF1, RO3)

It is fair to say that over recent years the fight against tax avoidance has been stronger than ever before - we've seen numerous cases (largely successfully) challenged in Tax Tribunals and in Court by HMRC, numerous changes to legislation (including targeted anti-avoidance rules), the introduction of the General Anti-Abuse Rule (GAAR), 'naming and shaming' in the press…the list goes on. Specifically for companies we have also seen the introduction, from this April, of the diverted profits tax.

However, on the other side of the coin we are now seeing that businesses are being recognised for paying the right amount of tax by being awarded the Fair Tax Mark - a kite mark. A "carrot" to complement the "stick" so to speak.

So what exactly is the Fair Tax Mark?

In a nutshell, it is the label for good taxpaying companies and organisations. Businesses that apply for, and are awarded, the Fair Tax Mark Kite mark essentially demonstrate that they are transparent about their tax affairs and seek to pay the right amount of tax.

So, by securing the Fair Tax Mark kitemark the reputation and perceived worthiness of the business is likely to be improved. In addition, consumers who are concerned about tax avoidance are likely to be reassured that the business is not engaged in such schemes.

The Fair Tax Mark provides the business with:

  • a confidential initial report and recommendations
  • guidance and templates to improve reporting
  • the option to display the Fair Tax trademark

What needs to be done to obtain the Fair Tax Mark:

  • The Fair Tax Society will obtain copies of your accounts from Companies House and assess them against the Fair Tax Mark Criteria (see below)
  • They then draw up a report showing how you or your accountant can improve your reporting 
  • You confirm changes and purchase a license to use the Fair Tax Mark

Licensing fees are banded according to a business's turnover. Half the fee is paid in advance and covers the cost of an assessment. The second half of the fee then purchases the licence to use the Mark for a period of one year.

The value of the Fair Tax Mark Criteria works in two ways; it protects the business from reputational and financial risk, at the same time as projecting an image of being open and honest to consumers and investors. On this basis, it requires commitment from the business not to engage in aggressive tax avoidance and assesses the quality of a business's publicly available information, i.e. a full set of accounts, on key tax and transparency issues.

More details of the requirements can be found on the Fair Tax website.

Just as we have seen "tax-avoiding companies" suffer commercially through customer boycott it will be interesting to see whether the Fair Tax Mark has the opposite effect for companies that apply for and obtain it. Commercial benefit would be the payback for the cost of acquiring the Kite mark. SSE (Scottish and Southern Energy) is the first PLC to have obtained the Fair Tax Mark. It will be interesting, in the competitive sector in which it trades, to see if it represents any kind of meaningful (commercially rewarded) point of differentiation.

The starting rate band and 40% tax

(AF1, AF2, RO3)

The introduction of the new £5,000 0% starting rate band from 2015/16 has created yet another anomaly in the UK tax system: a marginal rate of 40%, just above the personal allowance.

We already have a 60% marginal band where the personal allowance is phased out between £100,000 and (in 2015/16) £121,200 of total income and marginal rates of 50.76% or more where child benefit tax applies between £50,000 and £60,000 total income. Now consider the following:

  • Joan is 65 and has a state pension and small private pension which provide £10,600 a year. That is all covered by the personal allowance in 2015/16, so there is no tax to pay. 
  • She also has substantial fixed interest holdings and deposits, which produce £5,000 gross a year. Thanks to Mr Osborne's Budget 2014 largesse, this also escapes tax.

So far, so simple. Now let's give Joan an uncrystallised personal pension worth £4,000 which she decides to turn into cash under the small pots rule (or as a UFPLS). £1,000 (25%) will be tax-free, but the other £3,000 is taxed as pension income. If the plan is with another provider than her existing private pension, PAYE with a BR month 1 code will apply, so £600 will be deducted. That will not be enough to cover her 2015/16 tax bill:

  • Joan's total pension income has risen to £13,600, so there is a liability of £600 (£3,000 @ 20%). 
  • Her interest income is unchanged, but because she now has pension income £3,000 above the personal allowance, she only has £2,000 of starting rate band left (earned income ranks before interest in the pecking order of income). She therefore has to pay 20% tax on £3,000 of interest - another £600.

The net effect is that the £3,000 of pension income has added £1,200 to Joan's tax bill - an effective marginal rate of 40%.

As we have said before, in the words of the former US Treasury Secretary, William Simon, we should have a tax system which looks "like someone designed it on purpose." That will never happen while Chancellors of every hue tweak the current system. 

Foreign profits targeted with Obama's tax proposal

(AF1, AF2, RO3)

In President Obama's 2016 Budget he proposed that US-based companies should pay a one-off 14% tax on historical unrepatriated profits, regardless of whether the cash remains overseas or not, and a minimum 19% tax on their future foreign profits.

It appears that under the current US corporation tax system, income earned and retained by an overseas affiliate of a US company is not taxed in the US, provided the US parent company elects for this exemption to apply. Instead, the company is awarded tax credits for its payments to the overseas government, and the US corporation tax rate only applies when the income (or realised capital gains) is repatriated to the US. There is strong evidence that offshore untaxed (in the US at least) cash piles have been used to fund a number of large US company acquisitions of foreign targets.

These latest proposals provide a little further evidence that there is a global approach to ensuring that companies pay the 'fair rate' of tax .There appears to be a general accord in the developed world that concerted moves should be made to ensure that profits generated from trade in a country should, largely, bear tax in that country and not be capable of being shifted to a low tax jurisdiction.

In connection with this, the UK has "made a start" with the introduction, from 1 April 2015, of the UK diverted profits tax legislation- aka "the Google Tax". This, broadly speaking, will operate to apply a 25% UK corporation tax rate to profits earned from UK trade by a multi-national that has shifted profits abroad. It will be interesting to see how this is applied in practice once it comes into force.

Insurance contract law reform - The Insurance Bill

(AF2, CF3, RO5)

It is expected that the Insurance Bill will be passed by Parliament before the current session ends on 30 March 2015. In that event, the Act will come into force in 2016 (18 months after being passed). The Bill includes provisions on disclosure, warranties and the treatment of fraudulent claims. The Bill requires insurers to act with 'good faith' and limits the use of warranties in contracts.

The original "duty of disclosure" (of all material information) was perceived  as too harsh on the insureds. The Consumer Insurance (Disclosure and Representations) Act 2012 modified this for "consumers" by removing the positive obligation to disclose on consumers but left the obligation of disclosure for business insureds unchanged.

The duty of disclosure

The Insurance Bill now addresses business insurance. It replaces the duty of disclosure with an obligation to make a "fair presentation of the risk". So, in effect, it reduces the previous duty, but instead frames it in different terms and it is more onerous than for consumers. (Consumers have always needed more protection than businesses).

The "fair presentation of the risk" is defined as "every material circumstance which the insured knows or ought to know", which is actually very similar to the previous test, but more clearly defined.

If this level of disclosure is not met, the disclosure must at least provide sufficient information to put a prudent insurer on notice to make further enquiries for the purposes of revealing those material circumstances. The Bill provides examples of things that might be material.

The remedies for breach

The most important change contained in the Bill relating to disclosure is to the remedies for breach. If the breach is deliberate/reckless the insurer retains the right to avoid where it would not have entered the contract or only done so on different terms if proper disclosure had been made. If the breach was not deliberate or reckless the remedies are proportionate to the impact of the breach on the underwriting decision.


Currently, a breach of warranty in an insurance policy discharges the insurer from further liability from the point of breach (even if remedied before any loss and even if the breach was unrelated to the loss). This remedy, perceived to be draconian by many, is abolished by the Bill.

The Bill proposes that an insurer has no liability in respect of any loss occurring or attributable to something happening after a warranty has been breached, but before the breach has been remedied. This means that breach of a warranty results in suspension rather than a discharge of the insurer's liability so that if the breach is remedied before the loss, then it has no impact on the insurance.

Another welcomed change is the abolition of "basis of the contract" clauses (already precluded in consumer insurance) which have the effect of converting every statement in a proposal form into a warranty with the consequence that even non-material and innocent misrepresentations give insurers the right to avoid the policy.

Fraudulent claims

The Bill provides that when an insured submits a fraudulent claim:

  • the insurer is not liable to pay that claim;
  • the insurer may recover from the insured any sums paid in respect of the claim; and
  • there is the option to treat the contract as terminated with effect from the time of the fraudulent act. This would give the insurer the right to terminate the insurance such that losses suffered after the fraud need not be paid whereas losses before the fraud will be.

Good faith

The Bill abolishes the current right to avoid a policy on the grounds that the duty of utmost good faith has not been observed by the other party. However, the duty itself remains.

Contracting out

For non-consumer insurance contracts, the Bill provides parties with the ability to agree their own rules and "contract out" of the default statutory provisions. The only exception to this is in respect of basis of contract clauses. However, where the insurer wishes to include a contractual term which puts the insured in a worse position then the Act would provide, then this must be drawn to the attention of the insured and the term must be clear and unambiguous as to its effect.

It may help to remind who is /is not considered to be a "consumer". For this purpose a consumer is "an individual who enters into the contract wholly or mainly for purposes unrelated to the individual's trade, business or profession". A consumer must therefore be a natural person, rather than a legal person (such as a company or corporation), and an insurance contract may be "non-consumer" for two reasons: either the policyholder is not an individual, or they have entered into the contract wholly or in significant part for trade, business or professional reasons.

Life offices, of course, also deal with non-consumer clients, ie. business clients, especially in the area of employee benefits and business protection. Therefore, the above rules should be of interest and relevance to all insurance companies.


Investment Planning

Negative interest rates

(AF2, CF3, RO5)

We are increasingly entering a "through-the-looking-glass" world when it comes to interest rates. But how long can it last?

What return would you get if you lent the German government euros for five years?

The answer is less than nothing: the current yield on the five year benchmark Bund is -0.08%. If you think that's bad, then the two year Bund is offering -0.16%. Look outside the Eurozone and Denmark pays -0.65% for two year money, while Switzerland can borrow for ten years at -0.14%.

There was a time when central bankers fought shy of negative interest rates. Lord King, the former Governor of the Bank of England, dismissed the idea because of the financial problems it could cause UK building societies. There were also concerns that banks' IT systems would collapse if rates turned negative. Thus UK base rates have remained at the 0.5% floor they reached in March 2009.

Negative short-term interest rates now exist in the Eurozone, where the ECB willchargebanks 0.2% on short-term deposits. The Swiss central bank, following its dramatic dropping of the CHF/Euro peg last month, is now 'paying' -0.75% on deposits. Denmark, which has similar issues to Switzerland regarding its Euro peg, cut the rate it pays on deposits at the central bank to -0.5% at the end of January. Japan is on the cusp of negative yields, with two year government bond rates oscillating between negative and positive. Base rate has been 0% since October 2010.

The central banks have different reasons for the negative rates. The ECB wants Eurozone banks to lend money rather than leave it on deposit (the same stance as Japan), while both Denmark and Switzerland are actively trying to dissuade currency speculators and hold down the value of their currencies.

While short-term deposit rates remain negative, it is inevitable that some shorter term government bond yields will also be sub-zero. How far the negative yields stretch out reflects a market view not only on the future of rates, but also on the volume of purchases. In this regard the ECB's plan to start quantitative easing in March has given impetus to negative yields: the ECB has said it will buy bonds with negative yields.

How negative can yields become? One of the arguments previously put forward for an interest rate zero lower bound (ZLB) was that there was always the alternative of holding old-fashioned paper cash, which by definition securely yields 0%. The practical aspects of stockpiling paper money on a large scale have so far ruled that out. The 21st century world is not equipped to revert to a cash economy.

Negative interest rates are not new - Switzerland, Denmark and Sweden have all briefly dabbled with them in the past. What is new is the extent of negative rates. One estimate from JP Morgan was that there is now €1.5tn of Eurozone government paper maturing in the next twelve months with sub-zero yields. As monetary experiments go, it is a further twist on QE. What will be fascinating to watch is the impact of anyincreasein US rates, which is still pencilled in for June 2015.


Reporting requirement for individuals in flexible drawdown on 5 April 2015

(AF3, JO5, RO4, CF4, FA2)

Care should be taken in respect of any client who is in flexible drawdown on 5 April 2015, as they have a reporting requirement under the new pension flexibility rules.

Part 6 of the Taxation of Pensions Act 2014, sets out the requirements for members to report the fact they have started to access their benefits flexibly. They have 91 days to inform all schemes of which they are "active members" or to which they are making contributions. However, that is not an overly onerous requirement as the scheme under which they have flexibly access their benefits will inform the member of their reporting requirement.

However, there is a similar reporting requirement that applies to individuals who, prior to 6 April 2015, were drawing benefits under flexible drawdown. They have an obligation to report within 91 of a period beginning:

  • 6 April 2015 if on that date the individual is an accruing member of any registered pension scheme, or
  • if not, the first day after 6 April 2015 when the individual is an accruing member of a registered pension scheme.

The information that must be provided is that, as a result of section 227G(3), they are to be treated for the purposes of sections 227B to 227F as having first flexibly accessed pension rights at the start of 6 April 2015.

Clearly, many individuals elected for flexible drawdown as they had, for whatever reason, no intention of making further pension contributions. However, we understand that some pension schemes will be writing to individuals who are currently in flexible drawdown to advise those clients they can now once again benefit from an annual allowance. They may not, however, point out the associated reporting requirement associated with recommencing making DC contributions.

Advisers who have an ongoing commitment to advise clients who have access flexible drawdown should consider advising them of the resultant reporting requirement or possibly even suggesting they report to all their existing pension schemes immediately following the start of the new tax-year, even if there is currently no intention of making further contributions.

Additionally, clients should be informed that, should they commence a new pension arrangement on or after 6 April 2015, they will need to inform any new scheme administrator they have to be treated as having first flexibly accessed pension rights at the start of 6 April 2015.

Whilst these rules are in place, and there are associated fines (£300 plus £60 per day up to £3,000) for not reporting with in the statutory time scales, it is not yet clear how diligent HMRC will be in applying the penalties for non-compliance. However, we would suggest that advisers should err on the side of caution and bring this to their clients' attention.

HMRC issues Pension Liberation Newsletter 1

(AF3, JO5, RO4, CF4, FA2)

HMRC has issued the first, in what it is assumed to be a new series of Pension newsletters specifically on the topic of pension liberation.

On 4 February 2015, HMRC issued Pension Liberation Newsletter 1. This is the first, in what it is assumed to be a new series of Pension newsletters specifically on the topic of pension liberation.

In this newsletter HMRC sets out:

  • Its views on member responsibilities under the new pension freedoms
  • A roundup of the steps that they have previously taken to help combat pension liberation fraud.

We will consider these separately.

Pension Freedoms: HMRC's View

HMRC's view are that:

  • Pension savers will have the freedom to spend or invest their pension savings as they wish providing they meet the pension flexibility rules.
  • They want savers to make the right decisions about investments and to understand the consequences of not seeking proper advice.
  • Whilst HMRC's action to reduce the likelihood of pension liberation fraud, scammers will continually look for new ways to target individuals. HMRC states the ultimate the responsibility for getting the right advice lies with the pension scheme member.

This seems to imply that where individuals suffer tax penalties from pension liberation fraud, HMRC will not offer a sympathetic ear.

HMRC Steps to help Combat Pension Liberation Fraud

HMRC sets out both a roundup of steps taken over the last 18 months as well as a brief overview of those that come into effect from 6 April 2015:

  • October 2013, they changed the registration process for new scheme registrations so it is now much less of a "rubber stamping" exercise.
  • March 2014, they introduced several changes, including:
    • a new requirement that the main purpose of registered pension schemes should be to provide pension benefits
    • strengthening their powers to enquire into new registrations and existing registered pension schemes where HMRC suspect the scheme is involved in liberation
    • changes to make it easier for HMRC to de-register a scheme where we have reason to believe it is involved in liberation
    • new penalties where false information is supplied in connection with the registration application
  • September 2014; introduced the requirement for scheme administrators to meet the "fit and proper" test.

Additionally, HMRC goes on to set out new steps that it will be taking to further combat pension liberation fraud, including:

  • Requiring scheme administrators to provide HMRC with additional information and declarations online
  • Amendments to the information that must be provided to HMRC when a scheme changes its structure or range of number of members, to enhance HMRC's compliance activities to combat pension liberation. This is designed to help prevent a scheme being set up legitimately and then changing its structure to become a scheme that is more likely to be the target of pension liberation.

Draft legislation published to remove NEST's annual contribution limit and transfer restrictions

(AF3, JO5, RO4, CF4, FA2)

The DWP has published a draft of the legislation necessary to remove the annual contribution limit and the transfer restrictions on NEST.

Draft legislation has recently been published by the DWP to remove the annual contribution limit and the transfer restrictions on NEST.

The National Employment Savings Trust (NEST) was set up alongside the introduction of automatic enrolment to be a pension provider which any employer would be able to use for any worker. To prevent NEST from having an unfair advantage over commercial pension providers that do not have government backing, various constraints were placed upon it including an annual contribution limit and transfer restrictions.

Following consultation from October to December 2014, draft legislation has been published to remove the annual contribution limit and the transfer restrictions on 1 April 2017. The Government also retains the option to remove the individual transfer restrictions earlier, from 1 October 2015, to coincide with the introduction of automatic transfers.

The National Employment Savings Trust (Amendment) Order 2015 was laid before Parliament on 16 December 2014. The draft Transfer Values (Disapplication)(Revocation) Regulations do not need Parliamentary approval and subject to approval of the amendment order, these will be made in spring 2015.

This document is believed to be accurate but is not intended as a basis of knowledge upon which advice can be given. Neither the author (personal or corporate), the CII group, local institute or Society, or any of the officers or employees of those organisations accept any responsibility for any loss occasioned to any person acting or refraining from action as a result of the data or opinions included in this material. Opinions expressed are those of the author or authors and not necessarily those of the CII group, local institutes, or Societies.


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