Delays to online pensions system

Web-based plans put back six months

HM Revenue and Customs (HMRC) has been forced to postpone plans for mandatory online pensions administration because of delays developing the system.

A new simplified regime for taxation of pensions is due to begin on 6 April 2006, but plans for scheme administrators to file all details on the web have been put back for at least six months, with paper reporting being introduced as a fallback.

‘Registered pension schemes will be permitted to submit reports and returns in paper form for at least six months before the requirement to submit information online becomes mandatory,’ economic secretary Ivan Lewis told MPs last week.

A spokesman for HMRC says the delay was caused because development of the online system ‘was not proceeding at the necessary pace’.

‘Following a review of the progress being made on the development of Pension Schemes Online, and an exercise with representatives of the Pensions Industry Working Group and our IT supplier to prioritise delivery of the online service, we have decided to reduce the scope of the first release in April 2006 and to add a number of releases over the first year,’ he said.

‘This will involve a “just in time” delivery of online functions, so they generally become available when they are first needed. Scheme administrators and practitioners will still be able to meet the majority of their statutory filing and reporting requirements online.’

The spokesman says this is a large, complex project, requiring a complex back-end system.

‘We have been working to make sure this is as fully developed as possible to support the industry so that a scheme administrator can carry out all HMRC transactions online,’ he said. ‘As a result, there has been a significant amount of requirements gathering and development.’