Responding to HMRC’s consultation on the Normal Minimum Pension Age Transitional Provisions Regulations, the SPP says the final rules must protect members and pension schemes from unexpected tax charges and unnecessary administrative complexity.
The SPP is particularly concerned about people aged 55 or 56 around the 6 April 2028 change, where lump sums may have been agreed or become payable before the new minimum age but are delayed for administrative reasons.
The SPP is therefore calling for:
Transitional protection for all relevant lump sums where entitlement arose before 6 April 2028, even if payment is delayed until afterwards.
Clarity on Uncrystallised Funds Pension Lump Sums (UFPLS) where a member has taken the necessary steps to claim before the change but payment is delayed.
Clearer guidance from HMRC confirming that pensions already in payment before 6 April 2028 can continue uninterrupted.
Protection allowing further authorised member surplus payments to be paid where payments have already begun before 6 April 2028.
Clearer drafting and terminology so pension schemes can confidently identify members covered by the transitional arrangements.
Rapid finalisation of the Regulations, giving pension schemes and administrators enough time to update systems and communications.
The SPP warns that without a consistent approach, members and schemes could face potentially significant unauthorised payment charges because of delays or administrative circumstances outside their control.
It also stresses that uncertainty could lead to members in their mid-to-late 50s making decisions about their pensions based on incomplete or inaccurate information.
Oliver Topping, Chair of the SPP’s Legislation Committee, said: “The increase in the Normal Minimum Pension Age is a significant change for members approaching retirement, and it is essential that the transitional arrangements are clear, consistent and workable in practice. Members should not face unexpected tax consequences simply because an administrative process crosses the 6 April 2028 boundary. We are urging HMRC to quickly finalise the Regulations and provide the clarity schemes need to protect members and communicate the new rules with confidence.”
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