Legal News

What was the background to the consultation? Between February and April 2024, the Department for Work and Pensions ( DWP) carried out a consultation on ' Options for Defined Benefit schemes', assessing a range of prospective reforms to existing private sector DB pension schemes. This consultation succeeds a July 2023 Call for evidence (using the same title) and 'builds on the principles of' the funding and investment regime that came into force in September 2024. The DWP highlighted that approximately three in four DB schemes are currently in surplus on a low‑dependency funding basis, with around £160bn held as surplus assets. Consequently, the aims of the consultation included enabling schemes to channel funds into 'productive finance' by making it simpler to draw on scheme surpluses, alongside promoting further consolidation within the DB sector......

Aviva’s research showed that 54% of men identify as the primary planner of retirement savings, compared with 35% of women. According to the insurer, this points to a potential disparity in confidence or involvement between genders, or that men are more inclined to claim financial know-how. The study, carried out by Censuswide for Aviva, drew on a survey of 2,000 adults. It also found that a notable share of mid-life savers admit to avoiding their pension decisions. 54% of men say they take the lead on retirement planning, versus 35% of women. Three in ten savers aged 45 to 54 confess to ‘burying their head in the sand’ about their pension. Joanne Phillips, Managing Director of Aviva’s direct wealth business, said it is ‘fascinating to see that while’......

As it stands, the Pension Schemes Bill creates a new ‘reserve power’ enabling the government to require defined contribution ( DC) pension schemes to place a share of their assets into UK private markets. Yet, compliance could not be achieved by allocating to investment companies that themselves hold such assets, according to Richard Stone, Chief Executive of the AIC, in a letter of 22 July 2025 to Torsten Bell, Minister for Pensions at HM Treasury. DC pensions, spanning stakeholder pensions and most workplace arrangements, tie members’ outcomes to the investment performance of their contributions. Steering their future allocations towards private assets forms part of the government’s strategy to boost UK growth. Stone said the omission of investment companies from the Bill is unfair and indefensible, arguing that the reserve powers, as drafted, are seriously deficient. He added that they bar the use of...

Original news Mr L ( CAS-92761- H7Q6)—6 March 2025 Summary The Pensions Ombudsman dismissed a grievance concerning the distribution of death benefits under the Local Government Pension Scheme ( LGPS). In deciding, the administering authority considered all relevant factors, including the death benefit nomination and other potential recipients. The determination was neither unreasonable nor perverse. Accordingly, there was no basis to overturn the administering authority’s decision. This outcome serves as a reminder that trustees, and comparable decision-makers such as LGPS administering authorities, must follow a proper process that is robust to ensure their determinations are not set aside. What were the facts? Mrs R was a member of the Local Government......

Original news Mr A ( CAS-116234- R5N5)—4 March 2025 Summary The Deputy Pensions Ombudsman has dismissed a grievance concerning the repayment of pension contributions within an automatic enrolment arrangement. The complainant did not exercise the statutory one‑month opt‑out window. It was fair for the provider to rely on the employer-supplied address to issue the welcome pack. This decision underlines that automatic enrolment rules impose firm, narrowly defined deadlines for opting out. What were the facts? Mr A was put into membership of the Aviva Company Pension Plan (the Scheme) through automatic enrolment. Under section 8 of the Pensions Act 2008 there was an automatic entitlement to opt out of......

What was the background to HMRC’s consultation? In the 2024 Autumn Budget, the Chancellor set out her intention to bring inheritance tax into scope for pension funds that remain within an individual’s pension at death. While pension entitlements have, as a rule, sat outside the inheritance tax net, there has long been anxiety that pensions could be deployed as an estate planning device in ways that amount to inheritance tax avoidance. This anxiety sharpened following the relaxation of pension tax rules under the Finance Act 2004 ( FA 2004), which took effect in April 2006. From that point, the fear was that savers might shift assets into their pension and simply preserve the pot for their beneficiaries, particularly because FA 2004 removed any compulsion to secure an annuity. To counteract such outcomes, FA 2004 initially incorporated several limiting...

In this issue: The pensions tax regime Members and benefits The Pensions Regulator The Pensions Ombudsman Funding, surplus and investment Trustees, governance and administration Pensions dashboards Pension scams and liberation Public sector pensions Daily and weekly news alerts Dates for your diary Trackers The pensions tax regime HMRC pushes ahead with new IHT rules on unused pension funds from 6 April 2027 HMRC has released its response to the consultation on reforming Inheritance Tax ( IHT) treatment of unused pension funds, alongside a policy paper and draft Finance Bill 2025–26 provisions for technical consultation, which closes on 15 September 2025. HMRC confirms the government’s plan to bring most unspent pension funds and death benefits within IHT from 6 April 2027, but it has adjusted elements of the original proposals consulted on between 30 October 2024 and 22...

Pensioner Poverty: challenges and mitigations With more older people slipping into poverty, the Work and Pensions Committee’s report clearly contends that ministers should adopt a clear target for a minimum level of retirement income. It says the State Pension must fully secure a basic, dignified standard of living, and that a government strategy should then be set out to help everyone reach that benchmark, recognising the financial setbacks affecting many, including the 2.1 million still on the old State Pension. The report stressed that relying on safety nets such as Pension Credit and Housing Benefit alone is simply insufficient on its own......

On 21 July 2025 HM Revenue and Customs ( HMRC) issued its reply to the consultation, conducted between October 2024 and January 2025, on bringing unspent pension pots and death benefits within the scope of IHT, together with a policy paper and draft legislation that confirm the change to the rules on the IHT treatment of unused pension funds, due to formally apply from 6 April 2027......

The measures have been touted as wide-ranging Despite being presented as comprehensive, the government’s remit for the new Commission rules out any scrutiny of how the State Pension is constructed, or how tax relief could spur pension saving. Consequently, the independent commissioners charged with strengthening pension adequacy for tomorrow’s retirees are unlikely to enjoy full latitude. Steve Webb, a Partner at Lane Clark & Peacock LLP and former Pensions Minister, said the appointees are distinguished, trusted and expert, and will doubtless perform admirably, but have effectively begun with one hand tied behind their back. The Pensions Commission was relaunched as the government revealed that 14.6m people are under saving for retirement, up from the 12.5m identified as not saving enough in a Department for Work and Pensions report from 2023. Webb argued that, on a day when ministers conceded the number under saving has jumped by two...

Trachtenberg v Revenue and Customs Commissioners [2025] UKUT 206 ( TCC) What are the practical implications of this case? Following the UT’s rejection of Mr Trachtenberg’s appeal, and its conclusion that HMRC do have authority to assess income tax chargeable under FA 2004, ss 208 and 209 through the TMA 1970, the assessments issued by HMRC are lawfully made and HMRC are empowered to recover income tax where it has not been self-assessed. If the appeal had succeeded, the practical consequences would be hard to determine, because HMRC have already issued many hundreds, if not thousands, of income tax assessments under FA 2004, ss 208 and 209, relating to unauthorised payments made by a pension scheme that are liable to the unauthorised payments charge and the accompanying surcharge. Accordingly, HMRC’s assessments stand as validly raised, and the department retains power to collect amounts due where...

The new Pensions Commission will probe the disparity in savings between women and men and investigate why workers are not saving more into their private pensions. Government analysis shows nearly one in two working-age people set nothing aside, the announcement said. It will also examine the reasons behind low contributions to private pensions. Set up in 2002 by Tony Blair’s Labour government, the Pensions Commission will deliver its final report in 2027, outlining measures to secure better outcomes for those starting work and for future retirees. Work and Pensions Secretary Liz Kendall argued people should be confident of a reasonable income in later life. Yet, she acknowledged, that aspiration remains out of reach for many, particularly those on low wages or the self-employed......

On 17 July 2025 the Department for Work and Pensions ( DWP) issued a ‘list of upcoming DWP ad hoc statistical releases’ featuring an ‘analysis of under-saving for retirement in the working-age population’ scheduled for release on Monday, 21 July 2025. The DWP is also due to unveil two further reports. The first will consider the typical pension contribution rates under automatic enrolment and the proportion of people saving at statutory minimum levels. The second will analyse the disparity in average retirement savings between men and women. The DWP is poised to publish the reports amid expectations that the government will commence its review of pension adequacy before Parliament rises for the summer recess on Tuesday, 22 July 2025......

Master trusts TPR has imposed financial penalties of £50,000 each on NOW: Pensions Ltd and NOW: Pension Trustee Ltd for failing to properly report ‘significant’ matters connected to their omission to send out information to pension members. Alongside its press release, TPR also published a regulatory intervention report (under section 89 of the Pensions Act 2004) explaining how it used its powers following the decision of its Determination Panel to act thereafter. Under the regulator’s ‘significant event regime’, master trusts, which are occupational pension schemes used by many unconnected employers, must notify TPR of any system failures that significantly affect the running of their services......

PMI’s statement expressed frustration that Chancellor Rachel Reeves’ Mansion House address on Tuesday evening omitted any reference to the pledged second stage of the government’s pension review. This next phase aims to determine what employees should contribute to their pensions to secure a reasonable retirement income. It is expected to result in tangible changes, including widening automatic enrolment rules. Many had assumed the review would be unveiled during the annual Mansion House speech, yet it went unmentioned. Industry observers had widely expected detail at this juncture, given earlier commitments, but the absence of update drew criticism......

Leeds Reforms On Tuesday evening, the Chancellor delivered her annual address at Mansion House to the financial services sector, formally unveiling the Financial Services Growth and Competitiveness Strategy, referred to as the ‘ Leeds Reforms’, and setting out the government’s forthcoming actions in its growth agenda to position the UK as the destination of choice for financial services firms to establish, invest, scale and market their services worldwide. Although this did not feature in her prepared speech, it is reported she told representatives from the financial services sector at Mansion House that she does not expect the government will have to invoke a power in the Pension Schemes Bill to prescribe how pension funds deploy investments......

Renishaw Plc v Ross Trustees Services Ltd and another [2025] EWHC 1445 ( Ch) What are the practical implications of this case? This judgment exemplifies a clause whose wording appears unambiguous, yet, taken in context, plainly reveals a drafting error to any informed reader. A well-established rule of construction permits the court to rectify such mistakes by interpreting the document so it delivers the intended effect, where the correct solution is clear. The Supreme Court confirmed the availability of that approach for pension scheme documents in Barnardo’s v Buckinghamshire [2018] UKSC 55, [2019] I. C. R. 495. Even so, Coulson L. J. remarked in Britvic plc v Britvic Pensions Ltd [2021] EWCA Civ 867, [2021] I. C. R. 1648 that the case law suggests the principle should be confined to situations ‘where something has obviously gone wrong in a...

Crownsway Off Licence Ltd v The Pensions Regulator [2025] UKFTT 668 ( GRC) What are the practical implications of this case? This decision underscores the need for a proportionate and fair approach to enforcing automatic enrolment obligations under the Pensions Act 2008 ( Pen A 2008). The First-tier Tribunal set aside a £400 fixed penalty notice ( FPN) issued by TPR to the small employer, Crownsway Off Licence Ltd, for non-compliance with a UCN. The Tribunal accepted the breach stemmed from genuine difficulties: the payroll agent’s death and the successor’s inability to access the pension provider account. The judgment makes clear that, although TPR’s enforcement powers are strong, they are not limitless. Employers confronted with unexpected and credible operational hurdles may successfully challenge penalties where they can show a good reason for non-compliance, particularly when they are not at fault and swift...

Targeted support regime set to launch in 2026 The targeted support regime, due in 2026, will permit banks, financial advisers and others to recommend products to cohorts of similar customers, described as segments. Businesses employ segmentation to cluster consumers and deliver targeted support, narrowing suggestions to fit attributes commonly shared within each group. Yet the main barrier is the danger that firms could breach current rules by issuing marketing communications to investors. Regulatory lawyers are relying on the government to publish a policy paper on Tuesday 15 July 2025 setting out changes to financial services rules to make targeted support proposals workable. While commentators are generally positive about governmental backing for legal adjustments, they also note uncertainty about how the wider approach aligns with existing consumer protection measures under the FCA’s Consumer Duty. ‘ There is significant tension between what the FCA is...

Online Following IOSCO’s statement, on 28 May 2025 the European Securities and Markets Authority ( ESMA) revealed it had contacted a number of social media and platform firms, urging proactive measures to curb the promotion of unauthorised financial services and drawing attention to IOSCO’s drive (see: ESMA urges social media platforms to prevent unauthorised financial promotions, LNB News 28/05/2025 39). “ An ounce of prevention is worth a pound of cure”. Credited to Benjamin Franklin amid fire risks in Philadelphia in 1736, the maxim is equally apt for online harms in financial services, an area of mounting regulatory concern as digitalisation accelerates and retail involvement in capital markets expands. Thus far, supervisors have struggled to take effective action against those behind fraud, unauthorised activity and deceptive advertising enabled by social media. The cross‑border nature of many offenders’ operations, coupled with the practical...