51茶馆

9.1 General

The majority of pension schemes are registered with HMRC and are classified as 鈥楻egistered Pension Schemes,鈥� which can benefit from certain tax exemptions.

The registered pension scheme may make payment to or in respect of a member of the pension scheme, for the purposes of the administration of the scheme. 听These are called 鈥榮cheme administration member payments鈥�. Such payments may include payments made for the purchase of a pension scheme asset.
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9.2 Basis of Value

Section 171 of the Finance Act 2004 provides that such payments should be at an amount which听鈥渕ight be expected to be paid to a person who was at arm鈥檚 length.鈥澨鼳ny excess over the amount that would be paid on an arm鈥檚 length basis will be an unauthorised member payment and taxed accordingly.

The basis of value for pension scheme transactions is not explicitly stated as market value. 听However,听an amount paid听鈥渢o a person who was at arm鈥檚 length鈥澨齣s akin to the 鈥榤arket value鈥� basis of section 272 Taxation of Capital Gains Act 1992, as expanded on, and informed by, case law. Valuations should therefore be provided on the basis of market value.听
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9.3 Advice Required by HMRC

HMRC may require advice on:

1. whether a sale price represents the open market value of the property at the date of the transaction

2. whether any rent represents the open market rent having regard to the terms of the lease granted by the scheme trustees