Unfunded scheme meaning

When does a section 75 debt arise? An s 75 liability crystallises in respect of an occupational pension scheme that is underfunded on a buy-out basis and: an employment-cessation event happens for a relevant participating employer within a multi-employer scheme an insolvency event occurs in relation to a participating employer of the scheme, or the scheme formally goes into winding up In a multi-employer scheme, an employer’s s 75 debt is its allocated share of the scheme deficit, appropriately assessed on a buy-out basis. As an alternative to immediately paying the s 75 debt in full, an employer may enter into a deferred debt arrangement, an apportionment arrangement, or a withdrawal arrangement. Section 75 does not apply at all to money purchase schemes, unregistered pension schemes, unfunded public sector schemes, and a scheme with only one member. ...

In this issue: Finance Companies and corporation tax Private equity and venture capital Stamp and transfer taxes VAT Employment taxes Individuals and income tax Reorganisations, restructuring and insolvency LexTalk®Tax: a Lexis®Nexis community Daily and weekly news alerts Dates for your diary Trackers New and updated content Useful information Finance Court of Appeal reviews the scope of ‘annual interest’ and ‘beneficial entitlement’ for interest WHT (Hargreaves Property Holdings Ltd v HMRC). As noted in Tax weekly highlights—18 April 2024, the Court of Appeal in Hargreaves affirmed the FTT and UT decisions that the company was required, under section 874 of the Income Tax Act 2007, to deduct withholding tax from specified interest payments. The company maintained that the beneficial entitlement exception in ITA 2007, s 933 was engaged because the right to the accrued interest had been transferred to a UK resident company. The Court of Appeal rejected that position, concluding...

In this issue: Spring Statement Taxation Retirement options Funding Scheme governance Daily and weekly news alerts Dates for your diary Trackers Spring Statement Spring Forecast 2026—No key pensions announcements The government’s Spring Forecast 2026 on 3 March 2026 featured no new pensions announcements. However, the Office for Budget Responsibility’s Economic and Fiscal Outlook, issued alongside the Chancellor’s statement, sets out the fiscal impact of earlier changes to the triple lock, the State pension age and inheritance tax. It also references the surplus within unfunded public service pension schemes. At the same time, HM Treasury’s Debt Management Report 2026–27, published with the Spring Forecast 2026, confirmed that intended issuance of index-linked and long-dated conventional gilts has been reduced owing to diminished demand from pension schemes. For more detail, see Spring Forecast 2026 speech, Economic and Fiscal Outlook March 2026, Debt Management Report 2026–27 and LNB News 03/03/2026 37...

A D Bly Groundworks and Civil Engineering Ltd and another v HMRC [2024] UKUT 104 (TCC) Each taxpayer instructed the same firm of chartered accountants to set up a UURBS arrangement that committed them to paying pensions in future to directors and certain key employees. They recorded accounting provisions in their accounts to reflect the obligation to meet those later pension payments. Amounts booked ranged from 80% to 100% of pre-tax profits for each accounting period. The UURBS was disclosed to HMRC under the DOTAS rules. The FTT had rejected the taxpayers’ challenges to HMRC’s refusal to allow the provisions. The companies then appealed thereafter to the UT. The principal point at issue only...

ARCHIVED: This archived Practice Note summarises the Fee-Paid Judicial Pension Scheme (FPJPS), introduced by the Judicial Pensions (Fee-Paid Judges) Regulations 2017, SI 2017/522, arising from O’Brien v Ministry of Justice. It covers the statutory framework, governance, eligibility, contributions and benefit design. This note is not maintained... Statutory framework The Judicial Pension Scheme includes several arrangements: Judicial Pension Scheme 1981 (JPS 1981). Salaried judges appointed before 31 March 1995 will usually be members of this unfunded final salary scheme, created under JPA 1981. Judicial Pension Scheme 1993 (JPS 1993 or JUPRA). Salaried judges appointed between 31 March 1995 and 31 March 2015 will generally be members of this unfunded final salary scheme, established under JPRA 1993. Note that: There is an entitlement to elect to move from JPS 1981 to JUPRA at any point up to six months after retirement. For more information, see Eligibility, below. The Ministry of Justice began an options exercise in October 2023 to...

What is the National Health Service Pension Scheme? The NHSPS is an unfunded public service occupational pension that delivers salary‑related, defined benefit (DB) retirement provision for health service staff. The reformed NHSPS (often termed the ‘2015 Scheme’) began on 1 April 2015 as a career average revalued earnings (CARE) arrangement. New starters since that date have joined this scheme, which is the focus of this Practice Note. The legacy NHSPS (the ‘1995/2008 Scheme’) consists of two separate final salary sections—the 1995 Section and the 2008 Section—both closed to future accrual, while preserving a final salary link within that scheme. For further details, see Practice Note: The legacy National Health Service Pension Scheme. There are distinct schemes in Scotland and Northern Ireland, which are not covered by this Practice Note. When the reformed NHSPS opened, the government acted to close the 1995 and 2008 Sections to future accrual, subject to: ...

Private Client England & Wales glossary A Abatement When, after settling the deceased’s funeral costs, debts and liabilities, the remaining estate cannot satisfy all legacies in full, the gifts are reduced accordingly, unless the Will shows a different intention. In a solvent estate, the order for reduction appears in Part II of Schedule 1 to the Administration of Estates Act 1925. Refer to Practice Note: Payment of legacies. Accruals basis Where income is taxed on an accruals basis, it is attributed to a given tax year by reference to the number of days within that year during which the activity giving rise to the liability accrued. See Practice Note: What is the basis of income tax?. Accumulation and maintenance (A&M) trust A form of non‑interest in possession trust designed to benefit children and young people up to 25, which received favourable inheritance tax treatment between 1975 and 2006. See Practice Note: Accumulation and maintenance trusts—IHT [Archived]. Accredited Legal Representative (ALR) ...