On this page
- Key points
- Managers of personal pension schemes
- Codes and guidance
- Understand your obligations
- What you must report
- What you don't need to report
- How to report material payment failures
- You are responsible for monitoring contributions to the pension scheme.
- You need to take steps to recover missed or late payments quickly and efficiently.
- You must report any materially significant payment failures to the regulator in good time.
Managers of personal pension schemes
Managers of personal pension schemes can be:
- The personal pension scheme operator or provider, namely the person responsible to members for managing and administering the assets and income of, and the benefits payable under the scheme in accordance with pensions and tax legislation, the scheme’s provisions and the regulatory system. Typically, but not always, this is the appointed scheme administrator.
- Trustees operating a scheme jointly with the scheme administrator due to their responsibilities under the scheme trust deed for administering and managing the assets.
- Other parties liable as scheme administrator, and the persons responsible for the management of the scheme (other than a scheme established under trust).
Codes and guidance
We’ve updated our codes of practice on reporting late payment of contributions to defined contribution (DC) occupational and personal pension schemes and accompanying guidance.
The codes and the accompanying guidance aim to improve transparency and ensure that everyone involved in the flow of contributions has a clear understanding of their responsibilities.
Understand your obligations
It’s important that you understand your obligation to effectively monitor the pension scheme. In particular you need to know when to report a payment failure to us, what constitutes a ‘materially significant payment failure’, and when and how to report a payment failure.
You need to ensure that you:
- take responsibility for monitoring contributions
- take steps to recover and remedy missed or late payments quickly and efficiently
- ensure you report any materially significant payment failures to the regulator in good time.
You will also have to inform your members if such a payment failure occurs. This is a legal duty.
What you must report
Examples of material payment failures that you need to report to us:
- Where managers have reasonable cause to believe that the employer is not willing to pay the outstanding contributions. Where the managers’ reminder and recovery process has been exhausted without response from the employer or without them having obtained the outstanding payment they may assume this indicates an employer’s unwillingness to pay.
- Where there is a payment failure involving possible dishonesty or a misuse of assets or contributions. For example, managers may have concerns that the employer is retaining and using contributions to assist cash flow difficulties or where managers have become aware that the employer has transferred contributions elsewhere other than to the scheme.
- Where there is a failure to pay contributions which carries a criminal penalty. For example, information available to the managers may indicate that the employer is knowingly concerned in the fraudulent evasion of the obligation to pay employee contributions.
- Where the managers become aware that the employer does not have adequate procedures or systems in place to ensure the correct and timely payment of contributions due and the employer appears not to be taking adequate steps to remedy the situation, for example where there are repetitive and regular payment failures.
- In any event where contributions have been outstanding for 90 days from the due date.
What you don't need to report
Examples of what you shouldn’t normally report to us:
- Where managers have entered into a payment arrangement with the employer for the recovery of the outstanding contributions and the employer is paying in accordance with that arrangement.
- Where a claim has been submitted to the Redundancy Payments Office National Insurance Fund or the Northern Ireland Redundancy Payments Service.
- Where there are infrequent one-off payment failures or administrative errors resulting from, for example employees leaving the scheme or employment, new employees joining, or changes in salary not being notified promptly to the managers, and those occasional failures or errors have been corrected within 90 days of the due date.
- Where payments are made in excess of the contributions due under the direct payment arrangements.
- Where contributions are paid late but in full and within 90 days of the due date.
How to report material payment failures
This section provides you with information on how to use our maintaining contributions online service to report individual or multiple material payment failures from employers to your DC scheme.
Using this online service will help you ensure that you're able to report your material payment failures in line with our published codes of practice and guidance.
There are two different ways to report, depending on your role and the nature of the report that you need to make. You can either submit a single report or a bulk report.
- Single report: we recommend using this option when you have a small number of material payment failures to report.
- Bulk report: we recommend using this option when you have a large number of material payment failures to report to save you time on entering data. You can download a copy of our standardised data template once you're logged in to the service. Our template below contains information on the data you must provide, along with some additional guidance.
For more information on how to use the service please see our quick guide to reporting material payment failures below.
If you have any queries please see our reporting material payment failures questions and answers. You can send any queries not answered here to email@example.com.
See related content
Detailed guidance 4: Pension schemes (PDF, 349kb, 38 pages)
Section 5 of this guidance document explains how the qualifying criteria translate to contribution amounts
Quick guide for employers to paying contributions (PDF, 62kb, 6 pages)
A quick guide to paying contributions to personal pension schemes and defined contribution occupational pension schemes