Pension scheme members who want the SPPA to pay their 2023/2024 Annual Allowance (AA) tax charge to HMRC on their behalf using mandatory Scheme Pays have until 31 July 2025 to submit a request and fill in the necessary paperwork.
Members must complete and return a Scheme Pays Election Form to the SPPA by this date to ensure the mandatory Scheme Pays for 2023/2024 can be processed. This is known as ‘making an election’.
The impact of the 2015 Remedy has affected the provision of Remediable Pension Savings Statements (RPSS) for members who are eligible for the 2015 Remedy and, as a result, members are being provided with their 2023/24 pension input amount as part of their RPSS. This is to ensure that the pension tax position for each member for 2023/2024 is accurately reflected, taking into account revised pension input amounts for the Remedy period.
Members who believe they will be subject to an AA tax charge of at least £2,000 for 2023/2024 but have not yet received their statement and want the SPPA to pay this to HMRC on their behalf using mandatory Scheme Pays should fill out a Scheme Pays Election Form using an estimate of the AA tax charge.
Where a member has already completed a Self-Assessment tax return with a provisional AA tax charge figure for 2023/2024, the same provisional figure should be used to make a mandatory Scheme Pays election.
Pension scheme members who are unable to estimate the expected AA tax charge should enter a tax charge of £2,000 on the form. This is the minimum tax charge which can be paid using mandatory Scheme Pays.
Updating your tax information
When members receive their 2023/2024 statement and have confirmed the actual AA tax charge, they should also complete a revised Scheme Pays Election Form using the updated figure. The SPPA will calculate the Scheme Pays debit(s) and inform the member. Upon receipt of the Scheme Pays Notice, the member can then update their Self-Assessment tax return.
Members have up to 6 years following the end of the relevant tax year to change their Scheme Pays election.
Voluntary Scheme Pays
Members who have not received a 2023/2024 statement and are unable to make a mandatory Scheme Pays election by the 31 July 2025 deadline can still submit a voluntary Scheme Pays election after that date once they receive their statement.
This would be considered a late voluntary Scheme Pays election and members should be aware that they may be subject to late payment charges and interest from HMRC.
Applications for the voluntary Scheme Pays, need to have a total AA tax charge exceeding £1,000.00 to be accepted.
Voluntary Scheme Pays elections must be received by the SPPA no later than 1 December 2025 to be eligible for payment to HMRC by 31 January 2026.
If a member incurs late payment charges for 2023/2024 from HMRC caused by the 2015 Remedy and delays in the provision of RPSS, this can be reclaimed through the relevant Cost Reimbursement Scheme below: