All retirement accounts or products established under a:
are not Financial Accounts, and, therefore, a Financial Institution will have no reporting obligations under FATCA in respect of these accounts or products. For clarification, this applies to both the accumulation and decumulation phases of a pension scheme, contract or arrangement.
Registered pension scheme
A registered pension scheme is a pension scheme or contract that is registered with or deemed registered with HMRC. Any pension scheme or contract that had tax approval on 5 April 2006 (or whose tax approved status was granted on or after 6 April 2006, but was backdated so that the scheme was in effect approved on 5 April 2006) automatically became a registered pension scheme from 6 April 2006.
A deferred annuity “buy-out” contract that secures benefits that have arisen under a registered pension scheme is treated as a registered pension scheme from the date it is purchased.
The accumulation phase is the accumulation of savings (or accrual of benefit) in a registered pension scheme or other pension arrangement
The decumulation phase is the use of those accumulated funds to take a pension for the remainder of the individual’s or their dependant’s life.
“Pension” is defined under Section165 (2) Finance Act 2004, to include an annuity or income withdrawal as well as a pension that is paid directly from the pension scheme.
The following types of annuities are commonly pension annuities (that is to say funded with the accumulated savings from a registered pension scheme):
When a UK Financial Institution (regulated in the UK and subject to UK laws) writes pension business outside of the UK directly (though not through a permanent establishment in the country the person is resident in) this will not be a Financial Account if:
A UK Insurance Company directly writes pension business into the Netherlands, but it has no permanent establishment in the Netherlands. The pension account that is offered fully complies with Dutch pension and tax law, and consequently would be exempt under the Dutch/US IGA if the Financial Account was held by a Dutch-based Insurance Company.
If the account or product does not meet these criteria, then this will be a non-registered pension in the UK. It may still be an exempt account if:
A with-profits permanent health insurance contract where issued by a friendly society within the meaning of the Friendly Societies Act 1992 (c. 40).
This includes a long-term insurance contract offered or effected by a friendly society under the “Holloway system”, providing permanent health benefits and, also, investment benefits, where the investment benefits:
(a) are derived from surpluses accrued by the friendly society and apportioned to policyholders; and
(b) are payable to policyholders at maturity, on retirement, on death, or as otherwise specified by contractual provisions or individual society rules.