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Why is the Pension Administrator an important role?

The Finance Act 2004 introduced the role of “Scheme Administrator” in connection with the operation of UK pension schemes, ultimately the Scheme Administrator is the professional Trustee of your pension scheme.  Taylor Patterson performs the administration duties for you, ensuring the task is carried out in line with necessary pension regulations. This role must be carried out in addition to the usual day to day administration of a pension scheme.

The role of a Pension Administrator is quite complex and the potential fines can be devastating if the role is not performed correctly.

The Administrator first and foremost, must be registered with the “Pension Schemes Online” section of the HMRC website, and be capable of filing reports and making payments electronically. The Administrator must also ensure the pension scheme complies with the Pensions Regulator Code of Practice including maintaining a risk register, business continuity plan and a data protection policy.

Taylor Patterson provides Scheme Administrator duties to all of its UK pension scheme clients. Day to day the administrator is responsible for;

  • Setting up and maintenance of computer and administration records
  • Recording contributions/transfer payment into/out of the Plan and retirement benefits
  • Client communication and liaison on an on-going basis to ensure the Member(s) has full information on the current standing of the SSAS
  • Monitoring the liquidity of the scheme to ensure that income is received and expenses can be met
  • Processing such transactions and notifying Member(s) of any liquidity issues
  • Monitoring clients expression of wishes
  • Updating scheme documentation
  • Responding to general technical and administration enquiries as they arise
  • Executing allowable simple investment instructions and routine record keeping in association with these investments
  • Investigating the acceptability of investments (other than those to be held offshore or overseas)
  • Such other services as from time to time may be necessary to efficiently administer the Plan and to comply with HMRC requirements and the requirements of the Pensions Regulator
  • Maintain appropriate liability insurance
  • For Taylor Patterson to attend an annual trustee meeting

HMRC issued a change to legislation on 1st September 2014, to combat pension liberation activity. This new legislation entitles HMRC to refuse to register, or to de-register a scheme where the scheme administrator is not deemed a fit and proper person.

Fines and Penalties

There’s a range of fines and penalties which can be imposed on the Pension Scheme Administrator for not performing the above duties correctly. Serious breaches of HMRC regulations, or if the Administrator is deemed not fit and proper can lead to fines of up to 40% of the pension value, complete withdrawal of the pension scheme’s registered status and /or the fund becoming fully taxable.  It’s important you are confident that your pension scheme is being handled effectively.

These fines and penalties are payable from the pension fund or by you unless they are imposed as a result of the Administrator acting either negligently or fraudulently.

If you have any concerns or would like to discuss the role of the Taylor Patterson Pension Scheme Administrator, please call Kerry Houghton on 01772 555073.

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