NIM02731 - Earnings of employees and office holders: retirement benefits schemes from 6th April 2006 - overseas pension schemes: employer's payments that qualify for migrant member relief or transitional corresponding tax relief

Paragraph 3(a) and (b) of Part 6 of Schedule 3 to the Social Security (Contributions) Regulations 2001 (as substituted by regulation 8(3) of the Social Security (Contributions) (Amendment No. 2) Regulations 2006)

Paragraph 2 of Schedule 33 to the Finance Act 2004

Article 15 of the Taxation of Pensions Schemes (Transitional Provisions) Order 2006 (SI 2006/572)

For the meaning of migrant member relief and transitional corresponding relief see NIM02730 . An employer바카라 사이트檚 payment to which either:

  • paragraph 2 of Schedule 33 (tax relief for employer contributions to a 바카라 사이트渜ualifying overseas pension scheme바카라 사이트�); or
  • article 15 of the above Order (employers with pre-commencement entitlement to corresponding relief)

applies, is disregarded in the calculation of earnings for Class 1 NICs purposes:

Paragraph 2 will apply to an employer바카라 사이트檚 payment if

  • the payment is a 바카라 사이트渞elevant migrant member contribution바카라 사이트�. That is, a payment made to a 바카라 사이트渜ualifying overseas pension scheme바카라 사이트�; and
  • the employee is a 바카라 사이트渞elevant migrant member바카라 사이트� of the scheme.

In broad terms, article 15 will apply to an employer바카라 사이트檚 payment if:

  • their employee was, in the 2005/06 tax year, a member of a 바카라 사이트渃orresponding바카라 사이트� overseas pension scheme,
  • the employee is still a member of that scheme,
  • the scheme manager has undertaken to provide HMRC with information about payments made to the employee, and
  • the employer received a deduction in accordance with section 76(6A) and (6C) Finance Act 1989 for payments made in the 2005/06 tax year to that scheme in respect of the employee, and
  • the employer바카라 사이트檚 payment to that scheme is in respect of the employee.

For details of:

  • the Class 1A NICs position on a payment to a RPS, see NIM14510
  • the Class 1 NICs position on any benefit from the scheme which is referable to an employer바카라 사이트檚 payment to which either paragraph 2 or article 15 applies, see NIM02732