Moira Warner, Senior Intermediary Development and Technical Manager at Royal London, responds to the Government’s extension of the Voluntary scheme pays deadline.
“The Government has introduced an extension of the “Voluntary scheme pays” (VSP) deadline to 31st October 2020. This is intended to ease the pressure on over-stretched NHS pension scheme members to resolve their pension tax affairs for tax year 2018/19 by the imminent deadline of 31st July 2020 which would otherwise apply.
“However, scheme members are only able to use VSP if they are facing a tax charge and meet certain conditions. Other members facing a charge in relation to the growth in their pension savings in 2018/19 will need to use the “mandatory scheme pays” facility.
"The deadline for this, which is also 31st July 2020 has not been extended. This means the concession, which currently appears to apply only in England & Wales, will not fully meet its objective.
"Royal London has therefore called upon the Secretary of State for Health and Social Care to ensure that NHS scheme members missing the mandatory deadline of 31st July are able to benefit from the breathing space created by the VSP deadline concession. We have also called upon the Scottish Ministers to implement a similar concession to ease the burden on over-stretched NHS staff in Scotland.”
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About Royal London:
Royal London is the largest mutual life insurance, pensions and investment company in the UK, with assets under management of £138.9 billion, 8.6 million policies in force and 4,126 employees. Figures quoted are as at 31 December 2019.