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The tax year end is quickly approaching which brings with it all the challenges of tax planning for your clients for the current year and whilst there is not much time left in the current tax year (approximately 8 weeks to go), plans also need to be considered for the year ahead.
We should also consider the needs of our accountancy colleagues, who are busy completing the 12/13 tax returns, which need to be submitted by the 31st January 2014. All of the tax planning needs that require looking at be it on a personal, business or pension related matter will necessitate the assistance of typically the financial adviser, accountant and pension provider as all should be involved to ensure the client receives the best service and advice.
HMRC requests a Registered Pension Scheme Return in (RPSR) is completed for all registered pension schemes. The scheme administrator must report to HMRC on the transactions and assets of the scheme during the pension scheme tax year (currently 12/13 year) prior to the 31st January 2014.
Due to the importance of these RPSR returns, we have highlighted some of the questions that should be considered:-
How are your pension clients getting on?
Has the scheme administrator requested the information in a timely manner or has it been left to the last minute?
Has the existing scheme administrator made it easy to submit these returns?
What do these RPSR returns consist of?
The scheme administrator must comment on the value of the scheme including and separating out any assets that are connected to the individual. They need to comment on new investments made or investments sold, provide details on the income received or expenses paid on any of these assets held in the pension scheme. Specifics must also be included on contributions received (either made personally or via a company contribution) and any benefits that have been paid out such as tax free cash or pension income. This is not a definitive list but a few of the main categories the scheme administrator needs to consider.
Particular attention has to be made to any connected transactions i.e. connected rents received. It is particularly important to ensure that the information provided to the scheme administrator is accurate and provided in a timely manner, as HMRC can raise queries regarding any anomalies on these returns with the scheme administrator and can choose pension schemes for random review. To find out more about connected party transactions please click here to visit the HMRC website.
What are the implications of not submitting the RPSR return to HMRC before the deadline of 31st January each year?
Failure to submit the RPSR return will automatically incur the pension scheme with a fine of £300 (one –off charge) and thereafter a charge of £60 per day for each day the return is overdue. This may also give rise to a possible scheme investigation by HMRC.
Whilst the above may seem rather daunting, it is important for all concerned, that the information that the scheme administrator requests is provided in a timely manner, ensuring that the scheme administrator has sufficient time to complete the RPSR return in order to avoid any penalties imposed by HMRC for late submission.
To find out more how Taylor Patterson can assist in the collation and submission of the RPSR returns, please contact Kerry Houghton on 01772 550614 or email Kerry.email@example.com