Pension scheme administrators encouraged to resume reporting of non-taxable lump sum payments

18 October 2018

The updates that have been made to the Real Time Information (RTI) online service will prevent P6 coding notices being incorrectly issued to beneficiaries in receipt of pension lump sum death benefits that are entirely non-taxable.

HMRC have apologised for the length of time taken to resolve this issue.

Scheme administrators can now resume reporting non-taxable pension lump sum death benefit payments through RTI. For 2018 to 2019 scheme administrators can find guidance on how to report these payments in part 2.2.7 of the 2018 to 2019: Employer further guide to PAYE and National Insurance contributions - GOV.UK.

HMRC accept that it may take time for scheme administrators to amend their processes to report these payments again, but they want to encourage pension scheme administrators to start reporting these as soon as they’re able to.