Scheme pays: Everything advisers need to know

Annual allowance ‘scheme pays’ – dates for your calendar

clock • 3 min read

Martin Jones shares his technical insight on the scheme pays mechanism and highlights there are two variations which work on different timescales...

Since 2011, pension scheme members have been able to settle annual allowance tax charges via the ‘scheme pays' mechanism. This allows the charge to be paid direct to HM Revenue & Customs (HMRC) from the pension scheme as opposed to being paid via self-assessment. Clients can use this process to settle a charge that's arisen from contributions or accrual in that particular pension scheme. They can also use it to have one scheme pay a charge that arose due to contributions and accrual across more than one scheme. For example, a client could use a defined contribution (DC) scheme like a ...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Pensions

Women, wealth, and worry: How to close the retirement gender gap

Women, wealth, and worry: How to close the retirement gender gap

Julia Peake explores the retirement gender gap and suggests how it can be closed...

Julia Peake
clock 16 December 2025 • 4 min read
Senior pension figures question HMRC's 7.7 million salary sacrifice uptake figure

Senior pension figures question HMRC's 7.7 million salary sacrifice uptake figure

‘It doesn't take much of an error in those figures to have no benefit whatsoever’

Jenna Brown
clock 15 December 2025 • 8 min read
FCA launches consultation on adapting to a 'changing pensions market'

FCA launches consultation on adapting to a 'changing pensions market'

Outlines regime for digital pension planning tool

Holly Roach
clock 11 December 2025 • 3 min read