The Pensions (Abolition of Lifetime Allowance Charge etc) Regulations 2024

Part 4 of FA 2004

3.—(1) Part 4 of FA 2004 (pension schemes etc) is amended as follows.

(2) After section 244IC (availability of member’s overseas transfer allowance)(1) insert—

“244ID.    Information to be provided by relieved relevant non-UK scheme on block transfer

(1) Subsection (2) applies where—

(a)a relieved relevant non-UK scheme (“the transferring scheme”) makes a transfer to a QROPS, and

(b)the transfer is a block transfer in relation to any member of the transferring scheme.

(2) The scheme manager of the transferring scheme must, before the end of the period of 91 days beginning with the day of the transfer, provide the scheme manager of the QROPS with a statement stating—

(a)that the transfer is a block transfer and, accordingly, that an onward transfer subsequently made by the QROPS of sums or assets derived from those transferred by the block transfer may give rise to an overseas transfer charge under section 244IA,

(b)the date of the transfer, and

(c)the transferred value of the transfer (determined in accordance with section 244K).

(3) Section 244AB(2)(a) (meaning of “block transfer”) applies for the purposes of this section.”.

(3) Section 244K (meaning of “transferred value”)(2) is amended in accordance with paragraphs (4) to (7).

(4) In subsection (7)—

(a)in the words before paragraph (a), for “the charge” substitute “a charge under section 244AC or 244IA”;

(b)in the words after paragraph (b), for “given by subsections (2) to (6) grossed up by reference to the rate specified in subsection (1)” substitute “specified in subsection (7A)”.

(5) After subsection (7) insert—

“(7A) The amount mentioned in subsection (7) is the aggregate of—

(a)the chargeable portion,

(b)the gross-up amount, and

(c)the non-chargeable portion (if any).

(7B) In subsection (7A)—

“the chargeable portion” is—

“the gross-up amount” is an amount equal to one third of the chargeable portion;

“the non-chargeable portion” is—

(6) In subsection (8), for “the charge” substitute “a charge under section 244AC or 244IA”.

(7) In subsection (9), for “the charge”, in the first place it occurs substitute “a charge under section 244AC or 244IA”.

(8) In section 280 (abbreviations and general index)(3), in the table in subsection (2), at the appropriate place insert—

(9) Schedule 29 (definitions of lump sums) is amended in accordance with paragraphs (10) to (12).

(10) In paragraph 3C (pension commencement excess lump sum)(5)—

(a)in sub-paragraph (1), in paragraph (b), after “lump sum allowance” insert “, or when none of the individual’s lump sum and death benefit allowance,”;

(b)omit sub-paragraphs (2) and (3);

(c)in sub-paragraph (5)—

(i)in paragraph (a), after “lump sum allowance” insert “or lump sum and death benefit allowance”;

(ii)omit paragraph (b) and the “or” before it.

(11) In paragraph 4A (uncrystallised funds pension lump sum)(6) omit sub-paragraph (7).

(12) In paragraph 8 (trivial commutation lump sum: value of member’s relevant crystallised pension rights on the nominated date)(7), in sub-paragraph (1)—

(a)in the words before sub-paragraph (a) omit “the aggregate of”;

(b)omit sub-paragraph (a) and the “and” after it.

(13) Schedule 36 (transitional provision and saving: pre-commencement benefit rights) is amended in accordance with paragraphs (14) and (15).

(14) Omit paragraph 29A (enhancement of lump sum allowance where paragraph 24 applies)(8).

(15) In paragraph 34 (application of Schedule 29 to FA 2004 where paragraph 31 of that Schedule applies)(9), in sub-paragraph (2), for the definition of D substitute—

““D” is—