To help support NHS Pension Scheme members who are continuing to deal with the impact of the Coronavirus (COVID-19) pandemic, the decision has been taken to extend the voluntary scheme pays deadline for 2020/21.
If a member has an annual allowance charge for 2020/21 and they wish to use voluntary scheme pays to pay all or part of this charge, they now have until 31 March 2023 to submit their application.
Scheme pays allows members to ask the NHS Pensions Scheme to pay your annual allowance charge to HMRC. In return, their NHS Pension benefits will be permanently reduced when these become payable or if the member leaves and transfers out of the Scheme. The NHS Pension Scheme offers both a mandatory and voluntary scheme pays facility.
We do not have the authority to extend the mandatory scheme pays election deadline for 2020/21 as this is confirmed in legislation. The 2020/21 mandatory scheme pays deadline passed on the 31 July 2022.
Submitting a scheme pays application, known as a scheme pays election (SPE2) before the mandatory deadline allows us to consider the election under the mandatory scheme pays facility or a combination of the mandatory and voluntary scheme pays facilities. If paid under the mandatory scheme pays facility, the NHS Pension Scheme is responsible for paying the tax charge to HMRC by their deadline.
If a member applies to use scheme pays and we pay some or all of their annual allowance charge using our voluntary scheme pays facility, the member will remain responsible for the charge until the payment is made and for any interest that may be incurred for payments made after HMRCs tax bill deadline. HMRC’s deadline for 2020/21 was the 31 January 2022.
If a member has made a scheme pays election that was received by NHS Pensions after 31 July 2022 which has been returned because it was late and they still wish to have a voluntary scheme pays election, they should resubmit their election before 31 March 2023.
You can find more information about mandatory and voluntary scheme pays, how to apply for scheme pays and the deadlines for doing so on our annual allowance webpage.