SSAS registration process - current and future

Advisers need to be aware that planning around the creation of a SSAS needs to factor in significant allowance for the time in getting the scheme registered with HM Revenue & Customs (HMRC).

'Two stage' registration process

A recent change to the HMRC registration process for a new SSAS has resulted in formal approval taking 2-3 months and not the previous 5-10 working days.

It must be remembered that it is necessary for a scheme to be formally registered before it can accept new contributions or transfers from other registered pension schemes. It is, therefore, vital that advisers plan well in advance if a SSAS is required.

The change in process is as a result of continued abuse of SSAS by way of 'pension liberation' and the proliferation of scam investments promoted to inappropriate consumers. HMRC has, therefore, instigated powers available to it to request additional data before considering and granting registered status. Practitioners are now requesting this additional information at the point of scheme creation.

The information required is in standard format and requested on their form APSS530 but cannot be submitted at point of initial registration. Thus a “two stage” registration process now exists.

Current registration times for “clean schemes” (those with established trading employers and multi member) vary between 2-3 months and if the all the data is not submitted satisfactorily, timescales can be extended and in exceptional cases, HMRC can cancel the registration application.

Fit and Proper persons

One area that HMRC will check in detail is the requirement for the Scheme Administrator to be a 'fit and proper' person. This requirement was introduced from 1st September 2016 and is intended to make it harder for sham arrangements to be set up and for the aforementioned abuses to occur.

The intention is that registered pension schemes should only be run by appropriate people.

Whilst there is no published list of fit and proper people, HMRC make it clear in their guidance what a Scheme Administrator’s responsibilities are.

It is quite usual for scheme documentation to define the Scheme Administrator as the scheme’s trustees collectively. Often, as in our own SSAS, this will be the case and as such it is not only Dentons acting in the Administrator capacity, but also our co trustees.

As a result, as part of our scheme establishment process we require all members/trustees to declare that they are aware of the responsibilities of the Administrator role and sign a declaration accordingly. We will provide guidance and the links to the appropriate sections of the HMRC website which we believe will provide them with the information necessary to be comfortable in signing the declaration.

It is necessary for us as the practitioner requesting registration to confirm that at point of registration all parties undertaking the role of Administrator meet the required criteria.     

Future proposals to combat abuse

To further combat abuse, DWP and HM Treasury launched a consultation in December of last year to which responses were made by mid-February. The consultation mentioned a number of proposals by which the governance of SSAS and transfers to them could be strengthened. One of these was the suggestion to reintroduce a regulated and approved governance role that would be compulsory, not unlike the Pensioneer Trustee role that was removed in 2006.

The DWP/Treasury response was expected imminently but we suspect the 'snap general election' decision may have slowed down this process and delayed any formal action.

We will endeavour to keep you informed of developments.