Single Answer Questions Flashcards
What is FRS17?
A set of accounting rules which require companies to report pension deficits and surpluses in the year that the deficit/surplus occurred.
Which Act of Parliament set up greater protection and compensation schemes for members of occupational pension schemes?
Pensions Act 1995
Which Act of Parliament introduced the Pension Protection Fund (PPF)?
Pensions Act 2004
What is State Pension Credit?
A means tested benefit that tops up the income of the poorest pensioners.
When was a single pension tax regime introduced and what was the name of that day?
6th April 2006
A-Day
For whom was the State Second Pension available?
Available to certain low earners, and individuals receiving certain State Benefits such as Carer’s allowance.
Since 2016’s introduction of a single pension regime, how many years of NI contributions are required for the State Pension?
35 years.
In which year will the State Pension age for men and women be 67?
2028
How often will the State Pension age be reviewed?
At least once each Parliament.
A relevant UK individual must be less than what age?
Less than 75.
For a non earner, what is the maximum pension contribution which is eligible for tax relief?
£3,600
Does a pension contribution by an employer reduce NICs liability?
No, NICs is calculated on gross pay, so a pension contribution does not reduce the NICs liability.
What are the two methods by which employer sponsored occupational pensions are awarded tax relief?
The net pay method (whereby the pension contribution is made before income tax is calculated).
The relief at source method (the pension provided reclaims 20% at source, and the employee must reclaim any higher or additional rate tax via self-assessment).
What are the benefits of salary sacrifice?
There is a NICs saving for both the employer and employee (as the contribution is not regarded as earnings). Therefore, the overall benefit to the employee (pension and salary) may be higher, despite gross salary being lower.
How much is the annual allowance?
£60,000
How much is the Money Purchase Annual Allowance (MPAA)?
£10,000
When does the Pension Input Period (PIP) run?
6th April to 5th April (same as the tax year).
What factor is used to calculate the increase in member benefits of a DB scheme when considering the annual allowance?
16.
In addition to the increase in value of the annual benefits, the increase in PCLS is added to the increase (I.e. 16 x annual increase plus increase in PCLS).
For how many years can unused annual allowance be carried forward?
Three years.
How much annual allowance can be carried forward from previous years?
Any unused allowance can be carried forward, only relevant UK earnings on the current year matters.
Can unused Money Purchase Annual Allowance (MPAA) be carried forward?
No.
How much is the alternative annual allowance?
£50,000.