Reform of employer contributions into life assurance and overseas pension schemes
02 November 2018
Draft legislation has been published which will bring into effect the change to widen the definition of beneficiary for qualifying relevant overseas pension schemes.
This measure concerns premiums paid by employers into life assurance products and contributions to Qualifying Recognised Overseas Pension Schemes (QROPS).
As previously announced these contributions are currently only tax exempted if the named beneficiary is the employee or a member of the employee’s family or household.
This clause introduces amendments to Chapter 9 of Part 4 of the Income Tax (Earning and Pensions) Act 2003 (ITEPA) and will allow the beneficiary to be any individual or registered charity without the premiums being treated as a taxable benefit in kind.
This will allow the employee to nominate their preferred recipient irrespective of their relationship to the employee in law. This ensures that employees throughout the workforce are treated fairly and proportionately with employees in marriages or with close family.