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EPP and SSAS boost

Under the current draft- ing of the Pensions Act, trus-tees of these types of pension schemes will need to understand pension legislation, investments, scheme documentation and tax reporting by A-Day.

But Standard Life has been told by the Pensions Regul- ator that trustees of EPPs and SSASs will be exempted, with an announcement expected soon.

Trustee duties under the act, as currently drafted, are so onerous that many industry commentators had expected a mass switch out of these contracts into personal pensions or section 32 contracts as trustees look to avoid these respons- ibilities – largely because of the ongoing training that would be required.

Trustees will still have to file annual tax reports and face potential financial penalties if scheme reporting is not carried out accurately.

Standard marketing tech-nical manager John Lawson says he does not expect these reports to be any more ardu-ous than the tax returns for individuals except in more unusual cases such as where some members have claimed enhanced protection. He says the removal of trustee knowledge and understanding req-uirements will be a relief to many trustees.

Figures from the ABI show that there are around one million EPP policyholders.

Lawson says: “We will send information packs to our EPP clients. The trustee requirements for EPP schemes are not a big deal now because most if not all are also exempt from the member-nominated trus-tee requirements.”

Scottish Widows pensions development director Ian Naismith says: “The trustee knowledge and understanding requirements were onerous so this is good news but we have to ensure that trustees know there are a few extra things they will have to do.”

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