Protection of your lifetime allowance fixed protection Notes to help you fill in form APSS227 Application for protection of your lifetime allowance fixed protection. When to fill in form APSS227 You should use this form to apply for protection of your lifetime allowance under paragraph 14, Schedule 18 Finance Act 2011. These notes and form APSS227 refer to this protection as fixed protection. We must receive your form on or before 5 April 2012 or fixed protection will not apply to you. We have a range of services for people with disabilities, including guidance in Braille, audio and large print. Most of our forms are also available in large print. Please contact us on any of our phone helplines if you need these services. General These notes provide guidance on how to apply for fixed protection and what that means for you. They will help you fill in form APSS227. If you expect your pension savings to be more than the lifetime allowance of 1.5 million when you come to take your pension benefits on or after 6 April 2012 you can use fixed protection to reduce or eliminate liability to the lifetime allowance charge. Having fixed protection will mean that you will have a protected lifetime allowance of 1.8 million. You do not need to already have built up pension savings of more than 1.5 million to apply. If you are unsure of the value of your pension savings you will need to contact your pension Scheme Administrator(s). However, if you want to rely on fixed protection, there are restrictions on what you will be able to do with your pension savings. For example, after 5 April 2012 you will normally need to stop building up benefits in every registered pension scheme that you belong to. So make sure you tell your employer or pension scheme in good time if you want to stop building up benefits into your scheme, and remember to stop any direct debits. If you make any contributions or have benefit accrual on or after 6 April 2012 you will normally lose fixed protection. For more guidance on fixed protection go to www.hmrc.gov.uk/pensionschemes/lifetime-allowance/savings.htm If you apply for fixed protection HM Revenue & Customs (HMRC) will issue you a fixed protection certificate providing you do not have primary protection or continue to hold enhanced protection after 5 April 2012. You may want to give a copy of your certificate to your advisor. No certificates will be issued before 12 October 2011 so please do not contact us about your certificate before this date. How to tell us You must tell us if you plan to rely on fixed protection by filling in form APSS227 and sending it to: HMRC Pension Schemes Services FitzRoy House Castle Meadow Road NOTTINGHAM NG2 1BD APSS227 Notes Page 1 HMRC 07/11
Filling in the form You must fill in all sections on the form and sign and date it before you send it to us. If your application form has any mistakes or is incomplete we will return it to you to correct or fill in the missing information. If we return the form to you for correction after 5 April 2012 you will have four weeks to correct and return the form to us. If you do not do so within four weeks we will not deal with your application. Your details 1 Full name Enter title, first name, any middle name(s) and surname or family name. 2 National Insurance number This should be on your P60 End of Year Certificate, your P2 PAYE Coding Notice or your Self Assessment tax return. If you don t have a National Insurance number please send a letter with form APSS227 confirming this and explain why this is the case. 3 Unique Taxpayer Reference This is the Self Assessment reference number (also called the Unique Taxpayer Reference (UTR)) given to you if you fill in Self Assessment tax returns. 4 Date of birth Please enter the day, month and year of your birth. 5 Address This should be your personal address. We will send your fixed protection certificate to this address. If you want us to send the certificate to somebody else, please enter a Care of address instead of your personal address. 6 Do you plan to take any of your pension benefits between 6 April 2012 and 31 July 2012? If you do, please tick the Yes box and send your form to us as soon as possible. This will help us to make sure you receive your certificate before you retire or take benefits. Page 2
Primary protection about primary protection go to www.hmrc.gov.uk and look for primary protection within the Search facility. Please tick the No or Yes box as appropriate. If you have answered Yes then you should not send in form APSS227. You cannot benefit from fixed protection if you already have primary protection (whether or not you also hold enhanced protection). If you have told us you plan to rely on primary protection then you will have received a certificate with details of your protection. You cannot give up primary protection. Enhanced protection about enhanced protection and what you need to do to give this up go to www.hmrc.gov.uk and look for enhanced protection within the Search facility. Please tick the No or Yes box as appropriate. If you have enhanced protection you cannot benefit from fixed protection. If you have told us you plan to rely on enhanced protection then you will have received a certificate with details of your protection. However, unlike primary protection you can choose to give up enhanced protection. Please note that if, like many people with enhanced protection, you hold both primary and enhanced protection and you choose to give up enhanced protection, you will still have your primary protection. As you are unable to give this up this will stop you from benefitting from fixed protection. So there is no benefit in you giving up enhanced protection. If you have enhanced protection only (that is, without primary protection as well) then so long as you give this up before 6 April 2012 you can apply for fixed protection. Giving up enhanced protection You must tell us in writing if you want to give up enhanced protection, ticking box 9 is not enough. So if you do want to give it up we must receive confirmation from you by 5 April 2012. To do this you can either: enclose a letter with your fixed protection application form, or send us a separate letter. Please note that your enhanced protection will be lost from the date that we receive notification that you want to give it up. It is not possible to give advance notice of when you would like to give it up so you cannot say you would like to do this from a specific date, such as 5 April 2012. If you answer Yes at box 8 then you will need to confirm that you will no longer hold enhanced protection on or after 6 April 2012 at box 9. You will only be able to rely on fixed protection from 6 April 2012 if you have told us that you want to give up enhanced protection and have actually done so before this date. Ticking box 9 is not confirmation that you want to give up enhanced protection you must let us know see paragraph above. If you answer Yes at box 8 and do not tick the statement at box 9 we will return the form to you. If you do not plan to give up enhanced protection then you should not send in form APSS227. Page 3
Declaration on benefit accrual or other conditions for fixed protection go to www.hmrc.gov.uk and look for fixed protection within the Search facility. You must tick both boxes and sign and date the declaration, or we will return your form to you. If someone else, acting on your behalf, has filled in this form you must still sign the form yourself to confirm to us that, to the best of your knowledge, it is correct and complete. We will only accept a form signed by someone else in exceptional circumstances (see below). If you have signed on behalf of someone else There are very few situations when we accept a signature from someone other than the individual making this application. We accept such signatures in circumstances where a person is incapable of dealing with their affairs either due to mental or physical incapacity. The following people may fill in the form. In England and Wales or Northern Ireland, a donee of a lasting power of attorney (within the meaning of the Mental Capacity Act 2005) or deputy appointed for the individual by the Court of Protection. In Scotland, the individual s guardian within the meaning of the Adults with Incapacity (Scotland) Act 2000. In a country or territory outside the UK, a person authorised under the laws of that country or territory to deal with the individual s property and affairs. In addition, for persons who are not physically capable of dealing with the application form we will recognise ordinary powers of attorney or, in accordance with the Mental Capacity Act 2005, an enduring power of attorney executed prior to 1 October 2007. Loss of fixed protection under auto-enrolment From 2012 if your employer is subject to the automatic enrolment duty under the provisions of Pensions Act 2008 they will have to automatically enrol you into a qualifying workplace pension scheme. If your employer automatically enrols you in a pension scheme, you will have one month to opt out. If you opt out within that one month period then the law treats you as if you were never a member of the pension scheme. In these circumstances you will keep your fixed protection. If you do not opt out in time then you will lose your fixed protection. If you have applied for fixed protection and think that automatic enrolment into a new scheme will mean that you will lose this then you should speak to your employer or prospective employer who will be able to tell you how you can opt out of the pension scheme. Page 4
about benefit crystallisation events go to www.hmrc.gov.uk and look for benefit crystallisation events within the Search facility. What happens next If you have fully filled in form APSS227 and satisfy the conditions for fixed protection, we will send you a Certificate for fixed protection. This certificate will have a unique reference number. You must keep this certificate safe and, as long as you continue to meet the conditions for fixed protection, you should show it to your pension Scheme Administrator at every benefit crystallisation event you have after 6 April 2012. A benefit crystallisation event includes taking all or part of your pension or lump sum. This will mean that your liability to a lifetime allowance charge is reduced or even eliminated. If you don t show your Scheme Administrator your certificate you may not fully benefit from fixed protection. Other information Your rights and obligations Your Charter explains what you can expect from us and what we expect from you. For more information go to www.hmrc.gov.uk/charter How we use your information HM Revenue & Customs is a Data Controller under the Data Protection Act 1998. We hold information for the purposes specified in our notification to the Information Commissioner, including the assessment and collection of tax and duties, the payment of benefits and the prevention and detection of crime, and may use this information for any of them. We may get information about you from others, or we may give information to them. If we do, it will only be as the law permits to: check the accuracy of information prevent or detect crime protect public funds. We may check information we receive about you with what is already in our records. This can include information provided by you, as well as by others, such as other government departments or agencies and overseas tax and customs authorities. We will not give information to anyone outside HM Revenue & Customs unless the law permits us to do so. For more information go to www.hmrc.gov.uk and look for Data Protection Act within the Search facility. Page 5