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Occupational Pension Schemes

Volume 978: debated on Wednesday 6 February 1980

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asked the Chancellor of the Exchequer how soon after the interim approval of new occupational pension schemes the dividend income becomes tax-free; what mechanism is used by the Inland Revenue to ensure that any tax held by the Inland Revenue pending interim approval is returned to the pension scheme; what is the average waiting time between granting of interim approval and return of tax; and how much tax is held by the Inland Revenue pending return to pension schemes which have gained interim approval.

[pursuant to his reply, 1 February 1980, c. 794]: An occupational pension scheme is not entitled to tax exemption on its investment income until it has been formally approved. Any tax deducted from the date of establishment of the scheme is returned on the basis of a repayment claim by the trustees following formal approval. Repayment is made by the Inland Revenue as quickly as possible following receipt of the claim. The amount of tax currently awaiting repayment is not known.