HMRC issues announcements on the VAT treatment of pension
schemes
Despite predictions that the Chancellor would tinker further
with the tax of pension schemes, the Budget largely left pension
schemes alone, with the confirmation of an increase to the lifetime
allowance.
But before the Budget, HMRC was busy with two announcements on
the treatment of VAT and pension schemes.
Pension Fund Management Services provided by Insurance
Companies
HMRC's policy has been to allow all pension fund management
services provided by insurance companies to be exempt from VAT.
A Court of Justice of the European Union (CJEU) decision some
time ago made it clear that the VAT exemption for insurers applies
only to the underwriting of risk, and not to other supplies made by
insurers. UK law was amended in 2005 to remove any link between an
insurer's regulatory status and the entitlement to VAT
exemption on its supplies. But insurers were allowed to continue to
exempt their
