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Scottish Widows extends initial commission on pension transfers

Initial commission on pension transfers will continue to be paid to advisers up until the April 2016 deadline, Scottish Widows confirms.

In August, the provider said initial commission on pension schemes would be removed by November this year but now says, after testing it systems, that transfers will not be included in the ban.

Following reforms announced by the Department for Work and Pensions in March, all schemes used for auto-enrolment will need to charge 0.75 per cent or less. Schemes with adviser commission and active member discounts will be prohibited from April 2016.

A Scottish Widows spokesperson says: “While we are not able to continue to pay initial commission on regular premium business for commercial reasons, we have been working to ensure that we can continue to pay initial commission for transfer business up until the April 2016 deadline set out in the DWP’s command paper.

“Scottish Widows is keen to implement changes in a measured way which enables advisers to negotiate appropriate fee arrangements with their clients.”

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