NIM02705 - Earnings of employees and office holders: retirement benefits schemes from 6th April 2006 - Overview

From 6th April 2006, the tax treatment of pension schemes changed. The eight different tax regimes which existed prior to that date was replaced with a single universal regime for tax- privileged pension provision. Under the new regime, 바카라 사이트渦nregistered바카라 사이트� pension schemes are allowed to exist but enjoy none of the tax advantages of 바카라 사이트渞egistered바카라 사이트� pension schemes.

In simple terms, from the above date, there will be, essentially, two types of pension scheme:

  • registered pension scheme 바카라 사이트淩PS바카라 사이트�; and
  • employer-financed retirement benefits schemes바카라 사이트淓FRBS바카라 사이트�.

A RPS is broadly equivalent to an approved pension scheme which existed up to 6th April 2006. Whilst an EFRBS equates broadly to unapproved schemes - whether funded (a funded unapproved retirement benefits scheme 바카라 사이트淔URBS바카라 사이트� or unfunded 바카라 사이트淯URBS바카라 사이트�.

In addition to a RPS and EFRBS, there is, for NICs purposes only, one other type of pension scheme: an employer-financed pension only scheme 바카라 사이트淓FPOS바카라 사이트�. More details about this type are at NIM02790 (contents) - NIM02797.

The NICs treatment of payments into, and out of, a RPS and an EFRBS is, to a large extent, based on how such payments are dealt with for income tax purposes (but taking into account the fundamental differences between the income tax and NICs systems). But there are some significant differences in treatment, most notably in relation to payments out of an EFRBS.

For details of

  • the Class 1 NICs position on:
    • a RPS, see NIM02710 (contents)
    • an EFRBS, see NIM02750 (contents)
    • a FURBS up to 6th April 2006), see NIM02155 (contents)
  • the tax position on:
    • a RPS, see the 바카라 사이트淩egistered Pensions Schemes Manual바카라 사이트�;
    • an EFRBS and unapproved retirement benefits schemes, see EIM15000 (contents).