PTM167200 - Information and administration: other information requirements for scheme administrators: information that must be included in the pension savings statement

Glossary PTM000001

For guidance on the content of pension savings statements for tax years before 2015-16 see the Registered Pension Schemes Manual on the National Archives website.

For guidance on the content of pension savings statements involving tax years 2015-16 or 2016-17 (or both tax years), see previous versions of the Pensions Tax Manual on the National Archives website.

Regulation 14A(1A), (2) and (10) The Registered Pension Schemes (Provision of Information) Regulations 2006 - SI 2006/567

The information included in a pension savings statement depends on answers to the following questions:

• does the scheme administrator have reason to believe the member has flexibly accessed their pension rights, and
• were the member’s money purchase pension input amounts under the scheme more than £4,000?

If the answer to either (or both) is ‘no’, the scheme administrator should issue a standard pension savings statement (if required).

If the answer to both is ‘yes’, the scheme administrator must issue a money purchase pension savings statement.

PTM167100 explains when a pension savings statement must be given.

Money purchase pension input amounts
Standard pension savings statements content
Money purchase pension savings statements content
Example – standard pension savings statement
Example – money purchase pension savings statement
Format of pension savings statement

Money purchase pension input amounts

For the purpose of establishing whether a member’s money purchase pension input amount under the pension scheme exceeds £4,000 for a tax year, the member’s money purchase input amount means the total of the following amounts:

• for all of the member’s money purchase arrangements (other money purchase and/or cash balance arrangements) under the scheme, the pension input amount for each arrangement for the relevant tax year, and
• for all of the member’s hybrid arrangements under the scheme where the benefits that may be provided from the arrangement for the relevant tax year would be:
  • cash balance or other money purchase, the greater of the cash balance pension input amount and other money purchase pension input amount for the relevant tax year
  • cash balance or defined benefits, what would be the cash balance pension input amount for the relevant tax year (whether or not it exceeds the defined benefits pension input amount)
  • other money purchase or defined benefits, what would be the other money purchase pension input amount for the relevant tax year (whether or not it exceeds the defined benefits pension input amount), or
  • cash balance or other money purchase or defined benefits, what would be the greater of the cash balance pension input amount and other money purchase pension input amount for the relevant tax year (whether or not it exceeds the defined benefits pension input amount).

Standard pension savings statements content

A standard pension savings statement must contain all the following information:

• the total of the pension input amounts for the member for all their arrangements under the scheme for the relevant tax year
• the amount of the annual allowance for the tax year concerned
• the total of the pension input amounts for the member for all their arrangements under the scheme for the previous 3 tax years
• the amount of the annual allowance for the previous 3 tax years.

Money purchase pension savings statements content

A money purchase pension savings statement must contain all the following information:

• the total of:
  • the pension input amounts for the member for all their money purchase arrangements under the scheme for the relevant tax year - ‘amount 1’
  • the pension input amounts for the member for all their hybrid arrangements under the scheme for the relevant tax year where the pension input amount for the arrangement for the relevant tax year is a cash balance or other money purchase pension input amount - ‘amount 2’ (see the section Money purchase input amounts under a hybrid arrangement below)
• the total of:
  • the pension input amounts for the member for all their defined benefits arrangements under the scheme for the relevant tax year - ‘amount 3’
  • the pension input amounts for the member for all their pre-14 October 2014 hybrid arrangements under the scheme for the relevant tax year where the pension input amount for the arrangement for the relevant tax year is the defined benefits pension input amount - ‘amount 4’
• for each of the member’s 14 October 2014 hybrid arrangements where the pension input amount for the relevant tax year is the defined benefits pension input amount:
  • the defined benefits pension input amount for the relevant tax year, and
  • what would be the cash balance pension input amount for the relevant tax year
  • what would be the other money purchase pension input amount
  • (all of which being ‘amount 5’)
• the alternative annual allowance for the relevant tax year
• the fact that the member’s ‘money-purchase input sub-total’ for the relevant tax year will be tested against a £4,000 allowance
• the alternative annual allowance (see below) for each of the previous 3 tax years
• the fact that the member’s ‘money-purchase input sub-total’ for each of the previous tax years will be tested against a £4,000 allowance
• for the previous 3 tax years:
  • if the scheme administrator had reason to believe that the money purchase annual allowance applied to the member for the previous tax year concerned, amounts 1, 2, 3, 4 and 5 (as described immediately above) for the previous tax year concerned
  • if the scheme administrator did not have reason to believe that the money purchase annual allowance applied to the member for the previous tax year concerned, the total of the pension input amounts for the member for all their arrangements under the scheme for the previous tax year concerned.

Money purchase input amounts under a hybrid arrangement

If in the case of a hybrid arrangement for the relevant tax year:

• there is a pension input amount for a possible cash balance provision (‘amount A’) and a pension input amount for a possible defined benefits provision (‘amount C’) only and amounts A and C are the same, or
• there is a pension input amount for a possible other money purchase provision (‘amount B’) and a pension input amount for a possible defined benefits provision (amount C) only and amounts B and C are the same, or
• there is a pension input amount for a possible cash balance provision (amount A), a pension input amount for a possible other money purchase provision (amount B) and a pension input amount for a possible defined benefits provision (amount C) and amount C is the same as whichever is the greater of amounts A and B

amount C does not apply and the pension input amount for the hybrid arrangement for the relevant tax year is taken as amount A or B, as applicable for the hybrid arrangement concerned.

Where there are such pension input amounts for the hybrid arrangement, the pension input amount for the possible other money purchase or cash balance provision is used as part of the money purchase annual allowance test instead of the pension input amount for the possible defined benefits provision.

Pre-14 October 2014 hybrid arrangements

A pre-14 October 2014 hybrid arrangement means an arrangement that has been a hybrid arrangement from a date before 14 October 2014 and has continuously remained a hybrid arrangement since that date up to any point during the pension input period for the arrangement ending in the relevant tax year.

14 October 2014 hybrid arrangements

A 14 October 2014 hybrid arrangement means a hybrid arrangement that was made on or after 14 October 2014 or an arrangement which became a hybrid arrangement (whether or not for the first time) on or after 14 October 2014.

Alternative annual allowance

The alternative annual allowance means the annual allowance for the tax year concerned less the money purchase annual allowance.

This means the alternative annual allowance is £36,000 (being £40,000 less £4,000).

Example – standard pension savings statement

Judy is building up benefits in 2 arrangements under a single registered pension scheme. One arrangement is a defined benefits arrangement and the other is an other money purchase arrangement.

For 2022-23 Judy’s pension input amount for her defined benefits arrangement was £40,000 and £4,000 for the other money purchase arrangement. Judy’s total pension inputs for the pension scheme are £44,000, which exceeds the annual allowance of £40,000 for the tax year.

Her pension scheme administrator must send Judy a pension savings statement by 6 October 2023.

Judy’s pension input amounts for the previous 3 tax years are:

• 2021-22: £52,000
• 2020-21: £45,000
• 2019-20: £47,000

Judy’s pension scheme administrator gives her a pension savings statement showing the following information:

• 2022-23: pension input amount = £44,000; annual allowance = £40,000
• 2021-22: pension input amount = £52,000; annual allowance = £40,000
• 2020-21: pension input amount = £45,000; annual allowance = £40,000
• 2019-20: pension input amount = £47,000; annual allowance = £40,000

In this example, the information given to Judy is the same whether Judy is subject to the money purchase annual allowance or not. This is because Judy’s money purchase pension input amount under the pension scheme for the tax year does not exceed £4,000.

Also, even if the scheme administrator had reason to believe that the money purchase annual allowance applied to Judy for any of the previous 3 tax years, because a standard pension savings statement is being given in this case, a single pension input amount is given for each of the previous 3 tax years and not any of amounts 1 to 5 (as described in the section Money purchase pension savings statements content above).

Example – money purchase pension savings statement

Judy is building up benefits in 3 arrangements under a single registered pension scheme; a defined benefits arrangement, a hybrid arrangement that has remained so since before 14 October 2014 and an other money purchase arrangement.

For 2022-23 Judy’s pension input amount for her defined benefits arrangement was £40,000 and £3,000 for the other money purchase arrangement. For the hybrid arrangement the benefits which may be provided were defined benefits or other money purchase. The pension input amount for the defined benefits provision was £3,000 and the pension input amount for the other money purchase provision was £2,000.

The scheme administrator has reason to believe that Judy is subject to the money purchase annual allowance for tax year 2022-23 but not for any previous tax years.

Judy’s total pension inputs for the pension scheme are £46,000, made up of £40,000 for the defined benefits arrangement, £3,000 for the other money purchase arrangement and £3,000 for the defined benefits provision in respect of the hybrid arrangement.

The total pension input amount exceeds the annual allowance of £40,000 for the tax year.

The alternative annual allowance for tax year 2022-23 is £36,000 (£40,000 less £4,000).

The scheme administrator must send a money purchase pension savings statement because the total of Judy’s pension input amount for the other money purchase arrangement (£3,000) and pension input amount for the other money purchase provision in relation to the hybrid arrangement (£2,000) exceeds £4,000.

Her pension scheme administrator must send Judy a money purchase pension savings statement by 6 October 2023.

Judy’s pension input amounts for the previous 3 tax years are:

• 2021-22: £52,000
• 2020-21: £45,000
• 2019-20: £47,000

Judy’s pension scheme administrator gives her a pension savings statement showing the following information:

2022-23

• defined benefits arrangement pension input amount £40,000
• other money purchase arrangement pension input amount £3,000
• hybrid arrangement: defined benefits input £3,000
• alternative annual allowance £36,000
• ‘money-purchase input sub-total’ will be tested against a £4,000 allowance

2021-22

• pension input amount = £52,000
• annual allowance = £40,000

2020-21

• pension input amount = £45,000
• annual allowance = £40,000

2019-20

• pension input amount = £47,000
• annual allowance = £40,000

Format of pension savings statement

The format of the pension savings statement has not been set by legislation. It is up to scheme administrators to decide the format of their pension savings statements. However, in designing processes scheme administrators should bear in mind all of the following:

• the need for an audit trail - a scheme needs evidence to satisfy the member and HMRC that they have complied with the requirement to provide a pension savings statement, and HMRC may enquire into an individual’s tax return, so individuals will need evidence to back up what they say on their tax return
• all the information must be given as a single source
• the requirement to keep information set out at PTM160200, and
• the member’s ability to be able to receive the information, for example, a member may not have internet or e-mail access, or the member may have a visual impairment which makes using electronic communication difficult without using specialist software or equipment.