Self Invested Personal Pensions - Terms & Conditions
The Hoodless Brennan Self Invested Personal Pension Plan Core Terms and Conditions
Contents
Your Plan
1. Introduction
2. The Scheme
Contributing to your Plan
3. Contributions
4. Transfers
Investments/Plan Assets
5. Bank Accounts
6. Investments
7. Investment Management
8. Stock Custody
9. Instructions
10. Property
11. Charges
Running your Plan
12. Statements and documentation
For your security
13. Data protection, security and confidentiality
Taking Benefits from your Plan
14. Timing and form of Benefits
15. Pension Commencement Lump Sums,
16. Annuities
17. USP
18. ASP
19. Triviality
20. Death Benefits
21. The Financial Services Compensation (FSC) Scheme
22. Complaints
Varying/ending your Plan
23. Variation
24. Cancellation Rights
25. Term and Termination
Miscellaneous provisions
26. Miscellaneous Provisions
Your Plan
1. Introduction
This document contains legally binding obligations and you should:
(a) read it carefully; and
(b) keep it in a safe place for future reference.
1.1 Your contractual relationship with Capita SIP Services
The contractual relationship between:
(a) you (as a Member of the Scheme); and
(b) Capita SIP Services (as the Trustee and Scheme Administrator of the Scheme) in respect of the Scheme (and the rules governing the operation of your Plan) are set out in a series of documents referred to as the Terms and Conditions.
The provisions of the Terms and Conditions come into effect upon the date that your Application is accepted.
Other than in respect of the Dealing Service, Capita SIP Services is the provider of all pension and investment administration services in respect of the Scheme (and your Plan).
In respect of the Dealing Service, Capita SIP Services (as Trustee) will appoint Hoodless Brennan to provide the Dealing Service (and on the terms set out in the Hoodless Brennan Terms of Service once your Application has been accepted and you hereby confirm your consent to such appointment.
1.2 The parties to the Terms and Conditions
Throughout the Terms and Conditions:
(a) ‘you’ means, yourself and (unless explicitly required otherwise by Capita SIP Services) any third party notified by you to Capita SIP Services as being authorised by you to communicate with and/or give instructions to Capita SIP Services (and/or Hoodless Brennan) in respect of your Plan; and
(b) ‘Capita SIP Services’ means, Capita Life & Pensions Regulated Services Limited’ (company number 02424853) whose registered address is 61-71 Victoria Street, Westminster, London SW1H 0XA and whose principal place of business is 141 Castle Street, Salisbury, Wiltshire SP1 3TB.
(c) In respect of your Plan, Hoodless Brennan will be the default Investment Manager and is the provider of the Dealing Service. 'Hoodless Brennan' means Hoodless Brennan Plc, (company number 2693942) whose registered address and principal place of business is 40 Marsh Wall, Docklands, London, E14 9TP.
Other definitions used throughout the Terms and Conditions, are set out in the Definitions Schedule.
1.3 The Terms and Conditions
The Terms and Conditions in respect of your Plan will consist of the following documents, the:
(a) Core Terms and Conditions; and
(b) Charges Schedule; and
(c) Permitted Investments Schedule; and
(d) Definitions Schedule; and
(e) Application Form.
This document is referred to as the Core Terms and Conditions.
In addition to the above listed documents, the Terms and Conditions in respect of your Plan may also include the following documents, the:
(a) Charges of Hoodless Brennan as in Appendix 3 below (as provider of the Dealing Service); and/or
(b) Alternatively Secured Pension (ASP) Terms and Conditions (depending on whether any ASP Funds have been created in respect of your Plan); and/or
(c) Unsecured Pension (USP) Terms and Conditions (depending on whether any USP Funds have been created in respect of your Plan).
The following documents (though not part of the Terms and Conditions) provide additional details about how your Plan will be administered and operated and should also be read in conjunction with the Terms and Conditions, the:
(a) ‘SIPP’ area pages on Hoodless Brennan Website; and
(b) (if you are contemplating buying or have a Property within your Plan) [Property Guide, Property purchase/transfer in application and Property sale/transfer request.
Copies of all the above listed documents are available upon request from the Capita SIP Services Address and on the Hoodless Brennan Website.
1.4 Your consent to the Terms and Conditions
By signing the Application Form, you are:
(a) accepting the Terms and Conditions; and (b) agreeing to pay the [Capita SIP Services Charges], the Hoodless Brennan Charges and (as applicable in Appendix 3 below) any other Charges.
Please note that by signing the Application Form you are also accepting (if and only when your Plan is taken into ASP) to be bound by the then current version of the Alternatively Secured Pension (ASP) Terms and Conditions (see Section 18.1, below, for further details).
1.5 Commencement of the Terms and Conditions
The provisions of these Terms and Conditions Version 12 HB, 07/06 will come into effect and will govern your participation in the Scheme from the date your Application is accepted by Capita SIP Services.
1.6 Helping you to understand the Terms and Conditions
To assist you in understanding the Terms and Conditions, Capita SIP Services has, for ease of reference only:
(a) divided each Terms and Conditions document into numbered sections (for example, this ‘Introduction’ section is ‘Section 1 of the Core Terms and Conditions’); and
(b) used defined words and expressions consistently in all the Terms and Conditions documents (see the Definitions Schedule); and
(c) highlighted defined words and expressions in the text of the Terms and Conditions documents by using text that is bolded and italicised; and
(d) highlighted significant provisions relating to the operation of the Scheme by setting them in text boxes.
Section headings are included for ease of reference only and are not an operative part of these Terms and Conditions.
The language in which Capita SIP Services (and Hoodless Brennan) conducts its business (including contractual arrangements), is English.
1.7 Interpretation of the Terms and Conditions
The Terms and Conditions contain references to laws and regulations and to Capita SIP Services’ current understanding thereof. Capita SIP Services does not provide legal advice.
If you have any questions regarding the application of relevant laws or regarding the legal interpretation of the Terms and Conditions, please consult your legal adviser.
If you have any questions regarding the operation of the Scheme (other than in respect of the Dealing Service) or if you require any information regarding any aspect of your Plan, please contact Capita SIP Services at the Capita SIP Services Address.
If you have any questions regarding the operation of the Dealing Service, please contact Hoodless Brennan.
1.8 The Trust Deed and Rules
The Terms and Conditions are subject to the provisions of the Trust Deed and the Rules, which set out the legal and regulatory basis upon which the Scheme (and therefore your Plan) is operated and administered.
The Terms and Conditions may limit the extent to which the provisions of the Trust Deed and the Rules are applied to the operation and administration of your Plan. Provided that such limitations are permissible under the Trust Deed and the Rules, then the provisions of the Terms and Conditions will prevail over those of the Trust Deed and the Rules.
Copies of the Trust Deed and the Rules can be obtained upon request from the Capita SIP Services Address.
1.9 FSA definition of our relationship
Under FSA regulations, neither the Scheme nor your Plan are regulated products from the perspective of the FSA. However, Capita SIP Services (and, in respect of the Dealing Service, Hoodless Brennan) in administering your Plan, may perform certain services that are regulated by the FSA. In respect of such regulated services, you will be regarded as a ‘Private Customer’ (as defined in the FSA Handbook, a copy of which is available at: www.fsa.gov.uk/pages/handbook).
Capita SIP Services is authorised and regulated by the Financial Services Authority and is entered on the FSA register (registration number 145540) for the purposes of investment services.
Hoodless Brennan plc is authorised and regulated by the Financial Services Authority and is entered on the FSA register (registration number 155104).
For additional information regarding the protections afforded to you as a ‘Private Customer’, see Section 22, below.
1.10 Configuration of your Plan
Your Plan will ordinarily be set up as a single Arrangement.
The number of Arrangements within your Plan does not in itself affect the value of your Plan or of any Benefits payable from it.
In respect of your Plan, Capita SIP Services reserves the right to create or cancel Arrangements where in its reasonable opinion there is a requirement to do so.
1.11 Plan Performance
The value of your Plan and the Benefits that it will ultimately provide is dependent upon factors including the:
(a) investment performance of your chosen investments (see the investment risk warning at Section 6.5, below); and
(b) level of Contributions made to your Plan; and
(c) level of Charges deducted from your Plan; and,
(d) rate used to convert your Assets into an income; and
(e) tax treatment of your Plan.
The level of Benefits you require from your Plan may not be achieved if:
(a) the investment growth of your investments is lower than expected; and/or
(b) you reduce or stop payments into your Plan; and/or
(c) the rate used to convert your Assets into an income becomes less favourable; and/or
(d) the tax treatment of the Scheme becomes less favourable.
In respect of your Plan, Capita SIP Services cannot:
(a) guarantee the level of Benefits that will be provided; or
(b) advise upon the level of Contributions required to meet your financial objectives or advise upon their suitability for you (and you must seek such advice from your Adviser).
2. The Scheme
2.1 Description of the Scheme
The Scheme:
(a) is a Registered Pension Scheme; and
(b) does not hold an appropriate scheme certificate to enable Protected Rights to be held within it.
2.2 Management of the Scheme
Capita SIP Services is the Scheme Administrator and the sole Trustee of the Scheme.
In respect of your Plan, Capita SIP Services will appoint Hoodless Brennan to provide the Dealing Service in accordance with the Hoodless Brennan Terms of Service.
2.3 Operation of the Scheme
The Scheme is operated for the sole purpose of providing pension and lump sum Benefits in accordance with the provisions of Part 4 of the Finance Act 2004. To the extent permissible, all monies received by the Scheme on your behalf will be applied to your Plan.
2.4 Ownership of Assets
Capita SIP Services, as Trustee, is the legal owner of all the Assets of your Plan (which, as Trustee, it holds on trust for you and/or your Beneficiaries).
Contributing to your Plan
3. Contributions
3.1 Contracting out of the State Second Pension
The Scheme cannot be used for contracting out of the State Second Pension in order to provide Protected Rights benefits.
3.2 Member Contributions
Capita SIP Services is able to accept Member Contributions from you and on your behalf from third parties (excluding your employer, from whom contributions must be treated as Employer Contributions (see Sections 3.7 to 3.9, below)).
Member Contributions may be made:
(a) as a one-off payment in any amount as cash in the form of a cheque or bankers draft, made payable to ‘Capita SIP Services’ and sent to the Capita SIP Services Address:
(i) (in respect of an initial Contribution) with the Application Form; or
(ii) (in respect of any subsequent such Contribution) with a completed ‘Additional Contribution’ form (copies of which are available from the Capita SIP Services Address or the Capita Website; and/or
(b) on a regular basis (see the Application Form for further details); and/or
(c) on such other basis as Capita SIP Services may agree with you from time to time.
Where Member Contributions do not qualify for tax relief (see Section 3.4, below) such Contributions may only be made as a one-off payment in any amount.
3.3 In-Specie Contributions
In-Specie Contributions may only be made:
(a) as a one-off (or series of one-off) payment(s); and
(b) in respect of a Permitted Investment; and
(c) where Capita SIP Services has previously agreed to accept such a Contribution including being satisfied of the valuation basis of the assets.
Capita SIP Services will not in any event be liable for any capital gains (or any other tax, charge or Loss) arising in consequence of such a Contribution.
3.4 Member Contributions qualifying for tax relief
Subject to limitations (see Section 3.12 below) Member Contributions will qualify for tax relief provided that:
(a) the Member is under age 75 at the time the Contribution is accepted; and
(b) the Member is a Relevant UK Individual; and
(c) the Contributions do not exceed (in conjunction with all other contributions (together with any associated tax relief) that the Member has made within the relevant Tax Year to any other Registered Pension Schemes):
(i) one hundred percent (100%) of the Member’s UK Relevant Earnings (for the relevant Tax Year); or
(ii) £3,600 (gross) whichever is the greater.
Capita SIP Services will accept Contributions (and, where appropriate, claim tax relief’s) on the basis set out in the Application Form.
3.5 Payment of tax relief on Member Contributions
Member Contributions that qualify for tax relief (see Section 3.4, above) are paid net of basic rate tax. Capita SIP Services will claim tax relief at basic rate from HMRC on such Member Contributions.
For example, in respect of a net Member Contribution of £78.00, Capita SIP Services will claim (assuming a twenty-two percent (22%) basic rate of tax) £22.00 from HMRC, resulting in a gross Member Contribution of £100.00.
Capita SIP Services makes such tax claims monthly, in arrears. Tax relief is not available for investment until it is received from HMRC, which can typically take six (6) to ten (10) weeks depending on the timing of the Contribution. This tax relief will be credited to the
Members are responsible for reclaiming any higher rate tax relief from HMRC, which may be reclaimed through their local HMRC tax office and will not be credited to their Plan.
The tax relief’s referred to in the Terms and Conditions are those available under current legislation (as at the date of publication).
3.6 Recycling of Pension Commencement Lump Sums
Capita SIP Services will not allow the recycling (as defined in the HMRC Pension Regulations) of Pension Commencement Lump Sums in respect of the Scheme (see also Sections 15.3 to 15.5, below).
3.7 Employer Contributions
As Trustee, Capita SIP Services can accept Employer Contributions and you should consult with your employer to determine whether it is prepared to make such Contributions.
3.8 Monitoring Employer Contributions
Where your employer is paying Employer Contributions to your Plan, it will need to provide Capita SIP Services with a schedule of Employer Contributions due. This enables monitoring of safe receipt, in accordance with legislation. Your employer will also need to include in this schedule details of all Member Contributions that are due to be deducted via payroll.
3.9 Tax relief on Employer Contributions
Employer Contributions must be paid gross. You are not entitled to receive tax relief on Employer Contributions. Your employer may however be able to claim tax relief directly from HMRC against its own liability to tax.
3.10 Acceptance of Contributions
All proposed Contributions must be supported by the appropriate application form and/or any other documentation required by Capita SIP Services. Proposed Contributions received by the Scheme without the appropriate documentation will be unavailable for investment and will be returned unless such documentation is supplied within thirty (30) days of the proposed Contribution being received. Capita SIP Services reserves the right to reasonably refuse any proposed Contribution.
Once a Contribution has been accepted by Capita SIP Services, it cannot normally be refunded. The HMRC Pension Regulations only permit refunds in very limited circumstances.
Capita SIP Services cannot advise you as to the appropriateness (including any tax consequences) of any Contributions made to your Plan and shall have no liability in respect thereof. You should consult an Adviser if you have any questions regarding making Contributions to your Plan.
Please note, no payment can be accepted as a Contribution unless it is paid directly to Capita SIP Services and not, for example, through a third party (such as an Investment Manager).
3.11 Pension Input Periods
In respect of your Plan, the date upon which Capita SIP Services accepts the first Contribution into your Plan will trigger the commencement of the initial Pension Input Period.
In respect of your Plan, the HMRC Pension Regulations provide that either you or the Scheme Administrator may amend your Pension Input Period(s) at any time.
If you amend a Pension Input Period, you are required by the HMRC Pension Regulations to notify Capita SIP Services (as the Scheme Administrator) of this amendment. Such notice should be in writing and sent to the Capita SIP Services Address. Please note, the HMRC Pension Regulations do not require Capita SIP Services to use this information and no record will be kept of it.
Your Pension Input Periods (or any changes thereto) are entirely your responsibility and Capita SIP Services shall have no responsibility or liability in respect thereof.
For the significance of Pension Input Periods, please see Section 3.12, below.
3.12 Annual Allowance
Subject to certain exceptions (as set out in the HMRC Pension Regulations), if in any Pension Input Period your total gross contributions to all Registered Pension Schemes exceeds the Annual Allowance (the Annual Allowance for this purpose being the Annual Allowance for the Tax Year in which the relevant Pension Input Period ends) the amount of the excess contributions will be subject to an annual allowance tax charge.
The levying of any such tax charge is a matter between you and HMRC and Capita SIP Services shall have no obligations or liability in respect of any such tax charge.
3.13 Contributions and the Lifetime Allowance
If at the time you make a contribution you have already applied to HMRC for Enhanced Protection against the Standard Lifetime Allowance, such a contribution:
(a) will invalidate your Enhanced Protection entitlement; and
(b) may result in a Lifetime Allowance Charge being levied by HMRC when the Arrangements or part thereof Vest.
If you have any concerns as to whether a Contribution may result in a Lifetime Allowance Charge being levied, you should consult an Adviser. Capita SIP Services will not be liable for any Loss in the event of a Lifetime Allowance Charge being levied.
4. Transfers
4.1 Transfers In
A Transfer In will only be acceptable if it:
(a) does not contain any element which must be treated as Protected Rights within the Scheme; and
(b) it is from a Registered Pension Scheme provided that Capita SIP Services reserves the right to reasonably refuse any Transfer In.
Please consult with your Adviser if you require advice on whether any investment you wish to Transfer In contains Protected Rights or is from a Registered Pension Scheme.
Transferred funds will not be available for investment until:
(a) Capita SIP Services is satisfied that the Transfer In is acceptable; and
(b) the funds have been received.
4.2 Transfers Out
You may only request a Transfer Out to be made to another Registered Pension Scheme. You can Transfer Out the entire value of your Plan or part thereof.
Where the receiving Registered Pension Scheme is a Qualifying Recognised Overseas Pension Scheme, Capita SIP Services will be required to test the transfer value against your available Personal Lifetime Allowance on the same basis as is applied (see Sections 14.5 to 14.7, below) for Vesting benefits.
Capita SIP Services reserves the right to refuse any Transfer Out:
(a) until it has been supplied with sufficient information to be satisfied that the transfer payment is permitted; and
(b) if that Transfer Out would result in Borrowing exceeding fifty percent (50%) of the value of the Plan
and Capita SIP Services will not be liable for any lost investment opportunities or any reduction in the amount of the transfer payment, or other Loss arising as a result of any such delay or refusal.
The amount of a Transfer Out payment will be the aggregate value of the Assets being transferred as at the date the Transfer Out payment is made, less any applicable and otherwise outstanding Charges.
4.3 Additional funds received after a Transfer Out
Where:
(a) Capita SIP Services has acted in accordance with your instructions to Transfer Out to another Registered Pension Scheme the entire value of your Plan; and
(b) further investment funds are subsequently received (for example, from your Plan custodian) (such as dividend payments from stock previously held) Capita SIP Services will deal with such investment funds in accordance with the relevant provisions of the Rules (which usually will result in Capita SIP Services attempting to make a supplementary payment of these investment funds to the receiving Registered Pension Scheme).
4.4 In-Specie Transfers
It may be possible (subject to the agreement of the transferring and the receiving schemes) to effect an In-Specie Transfer of certain investments and Assets provided that they are Permitted Investments. Capita SIP Services will not be held liable for any Loss incurred as a result of any delay caused by a third party during such In-Specie Transfers.
4.5 Advice on transfers
Neither Capita SIP Services nor Hoodless Brennan offer or are authorised to give investment advice. Neither Capita SIP Services nor Hoodless Brennan check transfer applications for suitability other than to confirm eligibility. It is your responsibility to decide (having sought advice from an Adviser, if appropriate) whether a transfer is in your best interests.
4.6 USP/ASP transfers
Additional conditions (to those set out in Sections 4.1 to 4.5, above) will apply to transfers in respect of USP and ASP (see (respectively) Sections 8 and 13 of the Unsecured Pension (USP) Terms and Conditions and/or Sections 6.3 and 11 of the Alternatively Secured Pension (ASP) Terms and Conditions).
Investments/Plan Assets
5. Bank and brokerage accounts
5.1 Pooled cash account
In respect of your Plan, all cash Contributions and Transfers-In will initially be banked in a global account in the name of Capita SIP Services (as Trustee) with RBS, or another bank selected by Capita SIP Services. No interest is payable on cash balances held in this account.
5.2 Designated Account
Capita SIP Services (as Trustee) will be the authorised signatory of the Designated Account.
If you take funds into USP or ASP, cash will be transferred back from the Designated Brokerage Account to the Designated Account to fund your income payments. Normally, a float sufficient to cover six (6) months of income will be required though the Trustee reserves the right to vary this float at its sole discretion.
In order to provide USP and/or ASP administration services, it may be necessary for Capita SIP Services to establish additional bank accounts in respect of your Plan.
5.3 Designated Brokerage Account
Cleared funds in the pooled cash account will be transferred by Capita SIP Services to your Designated Brokerage Account as quickly as possible.
Interest will be paid by Hoodless Brennan on cash balances held in the Designated Brokerage Account at the rate set out in the Hoodless Brennan Terms of Service.
5.4 Designated Property Account
Capita SIP Services will open a Designated Property Account (which may be a pooled account, as may from time to time be determined by Capita SIP Services) in respect of each Property held within your Plan. In the case of a Property held in respect of more than one Plan, a single Designated Property Account will be opened in respect of that Property.
All Designated Property Accounts will be in the name of Capita SIP Services (as Trustee) and Capita SIP Services will be the authorised signatory.
5.5 Account Charges
No bank Charges are currently payable in respect of the pooled account, the Designated Account or the Designated Property Account, although Capita SIP Services reserves the right to levy such Charges against your Plan if they become payable to the bank.
If you instruct Capita SIP Services to open additional bank accounts as part of your Plan, these may bear specific Charges. Payment or receipt of monies in foreign currencies may also attract Charges.
No account Charges are currently payable in respect of the Designated Brokerage Account, although Hoodless Brennan may (pursuant to the Hoodless Brennan Terms of Service) in future elect to levy such Charges.
5.6 Overdrafts
It is your responsibility to ensure that:
(a) the Designated Account; and
(b) the Designated Property Account; and
(c) all other cash accounts, which form part of your Plan are never overdrawn.
All investments in respect of your Plan are directed by you (or, if applicable, by your Investment Manager) and you are responsible for ensuring that there are sufficient funds available in your Plan to settle any such investments.
If any cash account within your Plan becomes overdrawn, your Plan may incur interest Charges. In any event, Capita SIP Services may instruct the sale of Assets so as to comply with the HMRC Pension Regulations.
If due to an overdraft (or any other reason) the aggregate Borrowing in respect of your Plan exceeds fifty percent (50%) of the total Plan value, any Borrowing in excess of fifty percent (50%) will be deemed to be an Unauthorised Payment, subject to an Unauthorised Payment Charge.
6. Investments
6.1 Your investment objectives
Your investment objectives must have due regard to the purpose of the Scheme (see Section 2.3, above).
6.2 Permitted investments
A wide range of Permitted Investments are acceptable. Your Plan may include any combination of Permitted Investments (see the Permitted Investments Schedule).
Your Plan must not include any investment that is not a Permitted Investment.
Capita SIP Services reserves the right to refuse to accept investment instructions:
(a) that may cause, whether directly or indirectly, an adverse impact on the Scheme or on Capita SIP Services; and/or
(b) that may breach any relevant regulation; and/or
(c) in any other circumstances that Capita SIP Services, in its reasonable discretion, may determine.
Capita SIP Services reserves the right to dispose of any Asset which, in Capita SIP Services’ sole opinion, does not satisfy the HMRC Pension Regulations and Capita SIP Services does not accept liability for any resulting Loss.
6.3 Variation of Permitted Investments
Capita SIP Services may, from time to time, vary the list of investments that are Permitted Investments. You will be notified by Capita SIP Services of any such changes and, where practicable, be given thirty (30) days prior notice of any such change and any exceptions/variations to the change that may apply.
6.4 Property as an Investment
A Property qualifies as a Permitted Investment. If you wish a Property (or Properties) to be held within your Plan, you must ensure that you review and understand:
(a) Section 10, below; and
(b) the relevant Charges in the Charges Schedule; and
(c) the Property Guide; and
(d) the Property purchase/transfer in application.
6.5 Investment risk warning
Neither Capita SIP Services nor Hoodless Brennan provide investment advice and will not assess the suitability of any proposed investment or transaction. Capita SIP Services specifically draws your attention to the following:
(a) the wide range of investments and markets that you are able to invest in within your Plan have varying levels of risk attached to them; and
(b) the value of investments and the income derived from them may fall as well as rise and you may not recover the amount of your original investment; and
(c) it should be remembered that with any type of investment, past performance is not necessarily a guide to future performance; and
(d) some investments, such as Property, may take longer to sell than others and you may not be able to realise your investment when you wish to; and
(e) in respect of the administration of your Plan, the ‘value’ of any Asset may be based on a valuation rather than the market price; and
(f) that a Property is at risk of repossession following default of any loan provision; and
(g) that rental income on a Property cannot be guaranteed; and
(h) where investments are denominated in a currency other than Sterling, changes in rates of exchange may have an adverse or favourable affect on the value, price or income of the investments; and
(i) warrants often involve a high degree of gearing so that a relatively small movement in the price of the security to which the warrant relates may result in a disproportionately large movement, unfavourable as well as favourable, in the price of the warrant.
In respect of certain high risk investments (e.g. warrants) you may be required to sign a risk warning notice in relation to that investment type.
If a Property is held within your Plan, the Charges (e.g. professional fees) associated with the acquisition, administration and/or disposal of such a Property can be significant and you need to consider this in making any decision to acquire such a Property.
In the event that you are unsure about any aspect of making an investment in respect of your Plan, you should seek professional advice before proceeding.
Capita SIP Services shall not be liable for any Loss arising from your investment instructions except when such Loss results from Capita SIP Services’ own fraud or negligence.
7. Investment Management
7.1 Your Investment Manager
Other than in respect of Property all investment dealing and administration services for your Plan will be provided by Hoodless Brennan.
You will be responsible for making all investment decisions and giving investment instructions directly to Hoodless Brennan or (in the case of Property) to Capita SIP Services.
Capita SIP Services does not accept any liability for the performance or choice of any investment or of your Investment Manager.
The investments in your Plan may be selected by:
(a) you, using your own judgement; and/or
(b) you, on the advice of one or more Advisers.
Subject to the restrictions on Permitted Investments (see Section 6.2, above and the Permitted Investments Schedule) you will be responsible for agreeing the investment strategy with any Investment Manager appointed in respect of your Plan.
7.2 Capita SIP Services and your Investment Manager
Your Investment Manager acts for Capita SIP Services (as Trustee of the Scheme), not you, and is ultimately responsible to Capita SIP Services.
Capita SIP Services, as Trustee, will enter into your chosen Investment Manager’s terms of business once:
(a) you have read and approved those terms and conditions; and,
(b) Capita SIP Services is otherwise satisfied the Investment Manager’s appointment is acceptable, and you hereby indemnify Capita SIP Services against any Loss arising out of Capita SIP Services entering into any such agreement and Capita SIP Services’ liability will in any event be limited to the value of your Plan.
In respect of your Plan, Capita SIP Services shall have no liability for any stockbrokers’ or Investment Managers’ commissions, fees, and/or disbursements, which will be borne by your Plan.
7.3 Changes of Investment Manager
You must advise Capita SIP Services and Hoodless Brennan in advance if you wish to change your Investment Manager.
Capita SIP Services will not be liable for any Loss incurred as a result of any decision to replace any Investment Manager (including, for the avoidance of doubt, any Loss incurred as a result of delays while Capita SIP Services verifies the acceptability of a specific Investment Manager).
You hereby agree that if Hoodless Brennan ceases to be your Investment Manager, your Plan will, with immediate effect, be subject to Capita SIP Services’ standard charges and terms and conditions (as set on the Capita SIP Services Website) will apply.
8. Stock Custody
8.1 Asset registration
Assets in a form suitable for registration will be registered in the name of a nominee company. This may be:
(a) Raven Nominees Ltd. for equities held with Hoodless Brennan; or
(b) such other custodian as Capita SIP Services may from time to time determine provided always that Capita SIP Services reserves the right to appoint a nominee of its choice.
Other than in respect of the Dealing Service, Capita SIP Services will make the relevant arrangements regarding the designation of bank and (where applicable) nominee accounts.
As provided in the Hoodless Brennan Terms of Service, Hoodless Brennan are responsible for making arrangements with nominees in respect of the Dealing Service.
8.2 Collectively registered Assets
Your Assets may be registered collectively in the name of a nominee company. Where this is the case, your Assets may not be separately identifiable by certificates or other documents of title. In the event of default by a custodian or other party, any shortfall in investments registered in that way may be shared pro-rata among all customers whose investments are so registered.
8.3 Asset custody Charges
It is your responsibility to ensure that you understand the custody/ nominee Charges that apply to your Plan. The Charges of any custodian relating to Asset custody and settlement will be borne by your Plan.
8.4 Voting rights
Capita SIP Services, as legal owner of the Assets, will not exercise any voting rights that may exist in relation to any Asset.
8.5 Liability in respect of custodians
Capita SIP Services does not accept liability for any Loss caused by any custodian in respect of your Plan.
You should be aware that different segregation, settlement, legal and regulatory standards may apply where Assets are held by a custodian or sub-custodian outside the UK.
8.6 Restrictions on Assets
Assets cannot be lent to or deposited by way of capital with a third party and, in respect of the Scheme, money cannot be borrowed against the security of Assets. Excluded from this restriction are Mortgages (which comply with the HMRC Pension Regulations) taken out against specific Properties.
8.7 Reclaiming tax credits on foreign dividends
Capita SIP Services will not reclaim tax credits on foreign dividends unless requested (within one (1) year of actual tax deduction) to do so. Once Capita SIP Services is in receipt of all relevant documentation, it will make arrangements to reclaim any tax credit due on foreign dividends as instructed, subject to the appropriate Charge.
9. Instructions
9.1 Investment instructions
Capita SIP Services does not assess the suitability of any investment or any investment instruction but in any event reserves the right, at its reasonable discretion, to decline any instruction (and whether that instruction is made directly to Capita SIP Services, Hoodless Brennan or otherwise).
Subject to the provisions of Section 13.2, below, investment instructions in respect of your Plan (excluding those in relation to the Dealing Service) may be given to Capita SIP Services:
(a) in writing, to the Capita SIP Services Address and marked (in respect of Property investments) ‘Attn: Property Department’; or
(b) by facsimile to Capita SIP Services (in respect of Property investments) 01722 437367.
Capita SIP Services reserves the right to request confirmation and reconfirmation (in writing and/or by facsimile) of your investment instructions prior to effecting any such instruction. Capita SIP Services will not be liable for any Loss resulting from any such instruction or from any delay while confirmation is obtained.
Subject to the provisions of Section 13.2, below, investment instructions in respect of the Dealing Service may be given to Hoodless Brennan by instructing an equity trade:
(a) via the Hoodless Brennan Website; or
(b) by telephone call, to Hoodless Brennan on the published number 0207 538 1166; or
(c) by email to SIPP@hoodlessbrennan.com
9.2 Cash Deposits
Neither Capita SIP Services nor Hoodless Brennan are authorised to give investment advice and will not comment upon the suitability of holding sums of money on deposit in any cash account. It is your responsibility to review cash deposits held in your Plan.
In the absence of any contrary instructions from you, all cash will, unless otherwise required (for example if you are receiving income in the form of USP or ASP), remain in your Designated Brokerage Account.
9.3 Acknowledgement of investment instructions
In respect of the Dealing Service, Hoodless Brennan will provide contract notes in respect of trades, on the basis set out in the Hoodless Brennan Terms of Services.
9.4 Who may give instructions?
Capita SIP Services (and Hoodless Brennan in respect of the Dealing Service) will act upon instructions received (pursuant to Section 9.1, above) from:
(a) you; or,
(b) an authorised person (for example, your Investment Manager or (if a Property is held within your Plan) a Property Co-ordinator) provided that you have previously advised Capita SIP Services in writing that such person is authorised to give such instructions on your behalf.
9.5 Conflicting and erroneous investment instructions
In the event that Capita SIP Services (or Hoodless Brennan in respect of the Dealing Service) receives instructions from you and/or an authorised person that it believes are erroneous or in conflict with other instructions, it will attempt to clarify these prior to effecting these instructions. Hoodless Brennan and Capita SIP Services will not accept any liability (where it acts in good faith) for any Loss incurred during/following such clarification.
10. Property
10.1 Property as an investment
See Section 6.4, above.
10.2 The Property Guide and the Property purchase/transfer in application
When instructing Capita SIP Services to acquire, administer or dispose of a Property (or to effect the transfer of a Property in-specie) you are confirming that you have read and understood:
(a) the Property Guide; and
(b) (as applicable) the Property purchase/transfer in application and the Property sale/transfer request.
The Property Guide details the key issues relating to the acquisition, ownership and disposal of Property by the Scheme. Prior to an investment in Property, you will need to appoint a Property Co-ordinator (see Section 10.11, below).
The information set out in provisions of the Property Guide, and of the Property purchase/transfer in application and the Property sale/transfer request may be varied by Capita SIP Services from time to time. Copies of the current versions of these documents are available from the Capita SIP Services Address.
10.3 Joint ownership of a Property
Subject to the HMRC Pension Regulations, a Property may be held by the Trustee as a joint investment on behalf of more than one Member.
As set out in Section 5.2, above, Capita SIP Services opens only one Designated Property Account in respect of each Property. Any Charges arising in respect of the Property will be paid from the Designated Property Account. In respect of your Plan, it is your responsibility to ensure that sufficient funds are available in the Designated Property Account to meet these Charges.
In order to pay such Charges, Capita SIP Services will, if necessary, make up any shortfall from the Designated Account(s) of any Member whose Plan has an investment in the Property. In the event that such Charges are met by Capita SIP Services taking monies from the relevant Designated Account(s) in proportions other than those in which the Property is held by the relevant Plans, then this may change the proportions in which the Property is held by those Plans. Capita SIP Services will not be held liable for any Loss in such circumstances.
10.4 Unitisation
In order to facilitate the efficient administration of Properties in the Scheme, Capita SIP Services calculates the value of a Property investment on a unitised basis. In practice (in respect of a given Property) this means that:
(a) each £1 of initial investment (including the purchase price and any other transaction costs incurred up to and including completion) towards the purchase of that Property will be treated as a single unit (for this Section 10 only, a “Unit”); and
(b) the value of each Unit will fluctuate over time to reflect variations in the Property Investment Value (see Section 10.5, below); and
(c) each Unit will, at any particular time, have a unit price (for this Section 10 only, the “Unit Price”) calculated as follows: Unit Price equals the Property Investment Value (see Section 10.5, below), divided by the total number of Units (being, where the Property is held in respect of more that one Plan, the number of Units held by all Members); and
(d) the value of a Member’s holding from time to time in the Property is calculated using a formula: number of Units held by that Member, multiplied by the Unit Price.
10.5 Value of Property Investment
In respect of a Property, Capita SIP Services will calculate the property investment value as follows:
(a) Market Value of the Property; plus
(b) Designated Property Account balance; less
(c) the aggregate balance (as detailed on the Capita SIP Services administration system from time to time) of any Mortgage(s) in respect of that Property (being, for this Section 10 only, altogether the “Property Investment Value”).
Capita SIP Services will within five (5) weeks of receipt of the relevant Mortgage account statement from the lender reconcile the Mortgage account balance on the Capita SIP Services administration system with the balance in the Mortgage account statement.
It is not practicable or cost effective for Capita SIP Services to obtain a Market Value to correspond with each Unit Buy or Unit Sale (see Section 10.6, below). Capita SIP Services will use reasonable endeavours to obtain the value of the Market Value during each year immediately following each third anniversary of the date of acquisition of the Property. The Market Value will be fixed between each valuation date for unitisation purposes.
Capita SIP Services reserves the right at its discretion to obtain a Market Value to correspond with a Unit Buy or a Unit Sale transaction.
10.6 Variation of total Units in respect of a Property (Unit Buys and Unit Sells)
The number of Units in respect of a Property will increase (for this Section 10 only, a “Unit Buy”) where additional funds are added by a Member to the Designated Property Account (for example, to satisfy an obligation (such as an outstanding Mortgage repayment) in respect of the Property).
The number of Units in respect of a Property will decrease (for this Section 10 only, a “Unit Sell”) where funds are taken out by a Member of the Designated Property Account (for example, a transfer of cash to the Designated Account).
The number of Units in a Unit Buy or Unit Sell transaction is calculated by: dividing the money transferred into/out of (as applicable) the Designated Property Account, by the Unit Price.
10.7 Units in Properties held by more than one Member
The number of Units can vary from time to time as a result of Unit Buy and Unit Sell transactions and such changes will impact upon:
(a) the proportion of total Units held by each Member; and
(b) the value of each Member’s Plan.
10.8 Indemnity
In respect of any Property held in respect of your Plan, you hereby indemnify Capita SIP Services against any Loss resulting from:
(a) the basis of valuation used by Capita SIP Services in respect of any Unit Buy and/or Unit Sell; and
(b) (in respect of any Property held in respect of one or more other Members):
(i) fluctuations in Unit value; and
(ii) fluctuations in the number of Units; and
(iii) the actions or inactions of any other Member; and
(iv) changes (for whatever reason) in the proportions of Units held by different Members; and
(v) you acquiring an increased proportion of any Mortgage in consequence of another Member reducing their Unit holding.
10.9 Property Acquisition
As with any investment, Capita SIP Services does not assess the suitability of any Property. Capita SIP Services reserves the right at any time in any Property transaction to withdraw (at Capita SIP Services’ sole and reasonable discretion) for any reason without liability for any Loss.
A Property may become an Asset either by purchase or further to an In-Specie Transfer. Capita SIP Services will only commence the acquisition of a Property and (if necessary) instruct Panel Solicitors once it is in possession of all required documentation. Capita SIP Services will only purchase or effect an In-Specie Transfer of a Property when it:
(a) is a Permitted Investment;
(b) conforms with the HMRC Pension Regulations;
(c) does not involve an unacceptable environmental or other risk; and
(d) satisfies Capita SIP Services requirements (details of which are set out in the Property Guide).
Capita SIP Services will not be responsible for any Loss if the vendor of the Property decides to withdraw from the transaction for any reason.
10.10 Property Administration
Capita SIP Services will administer a Property following its acquisition but does not provide a full property management service. The Property Co-ordinator (see Sections 10.11 and 10.12, below) may request that Capita SIP Services appoint a qualified Property Manager (see Section 10.13, below).
In administering a Property, Capita SIP Services will be responsible (where practicable) for:
(a) the issue of rent demands to tenants and taking steps to pursue arrears; and
(b) receiving and banking rent; and
(c) the issue of receipted invoices for rental payments including VAT invoices (if applicable); and
(d) issuing standing order forms for completion by tenants if requested; and
(e) insuring the Property (where applicable) and paying the Property insurance premium from the Designated Property Account; and
(f) setting up standing orders for Mortgage repayments (as applicable); and
(g) obtaining, as necessary but at no more than three yearly intervals, independent surveys and valuations of the Property by chartered surveyors who specialise in commercial property valuations; and
(h) obtaining surveys and valuations of the Property by chartered surveyors each time there is a rent review or lease renewal; and
(i) (as and when Capita SIP Services deems it reasonably necessary and/or as required by the HMRC Pension Regulations) obtaining surveys and valuations by chartered surveyors of the Property on other occasions (for example, where a test against the Personal Lifetime Allowance is required), particularly if the Property is held for more than one Plan; and
(j) monitoring and reconciling the Designated Property Account including VAT accounting if the Property is VAT elected; and
(k) notifying the tenants of rent reviews under the terms of the lease and overseeing the rent review; and
(l) notifying the Property Co-ordinator of the expiry of any lease of the Property and overseeing any lease renewal proceedings that relate to the expiry; and
(m) taking all reasonable steps in dealing with correspondence received relating to the Property on the terms where practicable of the Property Co-ordinator’s investment decision provided always that where Capita SIP Services is unable to perform these tasks (e.g. lack of funds in the Designated Property Account) then it will not be held responsible for non performance of these tasks.
10.11 Appointment of a Property Co-ordinator
A Property Co-ordinator must be appointed by you (and jointly by you and other Members in the case of a Property held in respect of more than one Plan) to make investment decisions (as described in the Trust Deed) for you in relation to a Property. Capita SIP Services reserves the right to appoint a Property Co-ordinator if you fail to do so.
The Property Co-ordinator can be you (or another Member in the case of a Property held in respect of more than one Plan), your Adviser (or the Adviser of another such Member) or another suitable party.
A Property Co-ordinator can only resign or be replaced if the appointment of a replacement Property Co-ordinator is continuous. Capita SIP Services reserves the right at its absolute discretion to refuse to accept the appointment or resignation of a particular Property Co-ordinator.
10.12 Responsibilities of a Property Co-ordinator
The Property Co-ordinator will:
(a) be appointed (subject to the provisions of Section 10.11, above) by you completing the relevant section in the Property purchase/transfer in application; and
(b) make and advise Capita SIP Services of investment decisions in respect of the Property (such decisions will be deemed to be with your authority and shall be binding upon you); and
(c) provide investment instructions relating to the Property when contacted by Capita SIP Services to do so; and
(d) at all times keep Capita SIP Services informed of their current postal address.
10.13 Property Manager
Capita SIP Services will appoint a Property Manager to manage a Property upon:
(a) it deeming that a Property Manager is necessary (e.g. when the Property is multi-tenanted); or
(b) receiving instructions from the Property Co-ordinator to do so.
The Property Manager will undertake services as set out in the Property Guide or as advised to you. Neither you, another Member, a Connected Person, nor Capita SIP Services, can be appointed as the Property Manager.
Capita SIP Services does not accept any liability for default of any Property Manager.
10.14 Borrowing
Capita SIP Services does not provide advice on any Mortgage, the terms of which you must negotiate with the lender.
If requested by you, Capita SIP Services may, in respect of your Plan, Mortgage a Property in circumstances permitted by the HMRC Pension Regulations but will only do so if:
(a) the Mortgage documentation is complete and in a form acceptable to Capita SIP Services; and
(b) you have provided written confirmation of your agreement to the Mortgage terms.
Capita SIP Services may withdraw from any lending transaction for any reason (at Capita SIP Services’ sole reasonable discretion) at any stage without any liability for any resulting Loss.
The maximum aggregate value of any Mortgage(s) is limited to:
(a) (in respect of your Plan) fifty percent (50%) of the net value (i.e. after deduction of any Borrowing) of your Plan; and
(b) (in respect of any given Property) to seventy-five percent (75%) of the value of the Property being mortgaged.
10.15 VAT and Property Taxation
Neither Hoodless Brennan nor Capita SIP Services provide tax advice.
You must consult an Adviser on whether it is appropriate to waive exemption from VAT upon the acquisition or during the Trustee’s ownership of a Property. On the written instructions of the Property Co-ordinator, Capita SIP Services will waive VAT exemption under its own VAT registration.
Where VAT is payable (and whether on the purchase price of a Property or otherwise) you must ensure that there are adequate funds within your Plan to cover for any shortfall.
You must consult an Adviser in relation to other taxation issues that relate to your investment decisions in a Property and the Property Co-ordinator must provide Capita SIP Services with your investment instructions relating to taxation issues as they relate to the investment.
10.16 Occupational Leases
As Capita SIP Services is the legal owner (as Trustee) of any Property held in your Plan, Capita SIP Services will be the landlord in any tenancy of the Property.
All tenancies in respect of Property must comply with the HMRC Pension Regulations.
10.17 Disposal of a Property
A Property may cease to be an Asset either by being disposed of by sale or in consequence of an In-Specie Transfer out. Capita SIP Services will only commence the disposal of a Property and (if necessary) instruct Panel Solicitors once it is:
(a) in possession of all required documentation; and
(b) satisfied that the transaction:
(i) relates to a Permitted Investment; and
(ii) conforms with the HMRC Pension Regulations; and
(iii) meets Capita SIP Services’ requirements (details of which are set out in the Property Guide).
Where a Property is held in respect of more that one Plan, in the event that one of the Members wishes to sell a share of the Property, then the other Members will need to reach agreement as to how this will be facilitated, the options being that the:
(a) continuing Members buy out the value of the exiting Member’s interest; or
(b) continuing Members bring in a new Member with sufficient funds in his/her Plan to buy out the value of the exiting Member’s interest; or
(c) Property is disposed of in its entirety and the net sale proceeds allocated between the Plans of the Members in proportion to their share in the Property.
In the event that an agreement cannot be reached between all such Members, then Capita SIP Services reserves the right to sell the Property in its entirety as described above.
10.18 Property Charges
In respect of any Property investment, it is your responsibility to ensure that you have enough monies in your Plan to meet all related Charges.
Such Charges will be payable by Capita SIP Services from your Plan regardless of whether the transaction progresses to completion. You hereby agree to pay any shortfall in such Charges to Capita SIP Services on demand.
What your Plan costs
11. Charges
11.1 Current Charges
The Charges Schedule sets out Charges payable (including those payable to Hoodless Brennan and to Capita SIP Services) in respect of your Plan.
Please note, not all Charges set out in the Charges Schedule will necessarily apply to your Plan (for example, if you have not applied to enter USP, no USP related Charges will apply).
11.2 Payment of Charges
All Charges must be paid from:
(a) (in respect of non-Property related Charges) your Designated Brokerage Account; or
(b) (in respect of Property related Charges) your Designated Property Account; or
(c) (in respect of USP and ASP related Charges) your Designated Account.
Where your Designated Property Account or Designated Account holds insufficient cash to cover any outstanding Charges payable therefrom, Capita SIP Services will request payment from your Designated Brokerage Account with Hoodless Brennan.
Where your Designated Brokerage Account holds insufficient cash to cover any outstanding Charges (or any other amount due):
(a) Capita SIP Services will notify you of the shortfall; and then
(b) Capita SIP Services will give you thirty (30) days in which to provide sufficient funds (either by payment of an additional Contribution or by disposal of Assets); and then
(c) at the end of the thirty (30) days, Capita SIP Services may, at its sole discretion as Trustee, sell or procure the sale of Assets in the reverse order in which they were acquired sufficient to meet the outstanding amount due (and, where applicable, normal transaction Charges will apply to such sales(s)) and in any event you hereby agree to be personally liable for any such shortfall and Capita SIP Services shall have no liability for any Loss arising from any such disinvestment.
11.3 Variation of the Capita SIP Services Charges
The Capita SIP Services Charges will be reviewed and may be increased without notice on 5 April each year in line with the rise in the Average Earnings Index during the twelve (12) month period up to the preceding December. Such increases may be rounded up to the nearest:
(a) £1.00 (in respect of fees of less than £100); and
(b) £5.00 (in respect of fees of £100 or more).
Capita SIP Services may make other amendments or increases to Charges, or introduce new Charges, subject to thirty (30) days notice.
Capita SIP Services reserves the right to charge for additional services outside its normal administration activities on a time cost basis (see the Charges Schedule).
Hoodless Brennan may (further to the Hoodless Brennan Terms of Service) make amendments or increases to Charges relating to the Dealing Service, or introduce new Charges, subject to any notice period provided therein.
11.4 Capita SIP Services Charges for part years
If your Plan is terminated, no Charges (or parts thereof) which:
(a) have been paid in advance, will be refunded; and/or
(b) have become due, will be waived.
11.5 Custodian Charges
Charges levied by Hoodless Brennan will be payable in accordance with the Hoodless Brennan Terms of Service. The Charges of any other custodian will be levied at the rates agreed with that custodian.
If there are insufficient funds in your Plan to meet these Charges then, subject to the Trustee’s discretion, Assets will be sold in the reverse order to which they were acquired, to meet the outstanding Charges.
11.6 Pension Sharing Orders
If a Court issues a pension sharing order following divorce proceedings (or upon the dissolution of a civil partnership) in respect of your Plan, a Charge will be levied (on a time cost basis) to cover the additional administration required.
Within fourteen (14) days of any request from Capita SIP Services for you to identify any Assets to be sold or transferred (or as otherwise directed by the Court), you must notify Capita SIP Services which Assets are to be so sold or transferred in order to satisfy the amounts specified by the Courts. Failing such notification, Capita SIP Services, as Trustee, may at its sole discretion, sell Assets in the reverse order to which they were acquired sufficient to meet the amount due.
11.7 Charges exclusive of VAT
All Charges quoted are quoted exclusive of VAT, which is chargeable in addition where applicable.
11.8 Late payment of Charges
Any Charge that is not collected on the due date remains due until such time as it is debited from your Designated Account or otherwise settled.
11.9 Third party payments to Capita SIP Services
You hereby agree that Capita SIP Services, (whether acting as Trustee, Scheme Administrator or otherwise) may receive and benefit from payments from third parties (including, without limitation, intermediary fees), which are paid to Capita SIP Services in connection with its operation and administration of the Scheme provided always that such payments do not result in:
(a) Capita SIP Services breaching any regulatory obligation or duty as Trustee; and/or
(b) any financial detriment to any Asset or Plan.
Running your Plan
12. Statements and documentation
12.1 Statements you will be sent
To the extent required by current legislation, you will be sent, in respect of your Plan and on an annual basis:
(a) an annual benefit statement; and
(b) a statutory money purchase illustration; and
(c) a summary of the Assets held in respect of your Plan; and
(d) a confirmation of the percentage of the Standard Lifetime Allowance that has been used in respect of the Scheme.
Statements in respect of your Dealing Service Account with Hoodless Brennan are available from the Hoodless Brennan Website in electronic format for online accounts and sent at least quarterly by Hoodless Brennan in respect on non-internet accounts in paper format.
Capita SIP Services reserves the right to levy a Charge for the provision of additional valuations.
12.2 Documentation
You hereby agree that in order to facilitate the efficient operation of your Plan, you will on a timely basis:
(a) complete any forms or documents; and
(b) provide Capita SIP Services with such other information and/or documentation, as Capita SIP Services may reasonably require from time to time (including, for example, such information as may be required to enable Capita SIP Services to fulfill its obligations under the anti-money laundering regulations).
For your security
13. Data protection, security and confidentiality
13.1 Data protection
Hoodless Brennan and Capita SIP Services will process your personal data and information in accordance with the Data Protection Act 1998.
The personal information supplied by you to us in respect of your Plan may be used for the following purposes:
(a) the administration of your Plan; and
(b) for business analysis purposes (both within Capita SIP Services and (to the extent necessary) any other organisation within the same corporate group). You hereby authorise Hoodless Brennan and Capita SIP Services to pass your personal information to:
(i) any professional financial or investment adviser(s) that you have appointed under the Terms and Conditions; and
(ii) any necessary third party in connection with administering your Plan (including Capita SIP Services’ professional advisers).
You hereby consent to Capita SIP Services obtaining any relevant pensions or related details from any source. This would include any professional financial or investment adviser, scheme practitioner, administrator, trustee, insurance company or any other pension provider of any scheme, arrangement or contract of which you have ever had any benefit entitlement. You also authorise the holders of this information to supply it to Capita SIP Services on request.
You hereby consent to Capita SIP Services providing any relevant information related to your Plan to your professional financial or investment advisers, pension scheme trustees, administrators, practitioners, insurers or pension providers when required to do so. You understand that, if necessary, Capita SIP Services will pass your details on to such regulatory authorities or other third parties, as may be required.
If any transfer from your Plan is a Block Transfer, you consent to your details being stored on the records of other transferring member(s). You understand that this information would be held solely for the purposes of calculating the pension and lump sum entitlement of the other member(s) and that no information regarding your benefits will be disclosed to any such member. Similarly, you consent to the details of any such person being stored on your records for the purposes of calculating your pension and lump sum entitlements.
Any documents in Capita SIP Services’ possession in relation to:
(a) any monies received by or owing to the Scheme; and/or
(b) any investments or Assets held by the Scheme; and/or
(c) any payments made by the Scheme; and/or
(d) any contracts to purchase an Annuity; and/or
(e) the administration of the Scheme
will be retained for a period of at least the Tax Year to which they relate and the next six (6) Tax Years thereafter and in any event will be retained for as long as required for the effective administration of your Plan and/or the payment of any Benefits thereunder.
13.2 Data security
In respect of your Plan, Capita SIP Services will usually only communicate with you at your residential address, as specified on your Application Form. If you wish to communicate with Capita SIP Services by facsimile or email, Capita SIP Services will act upon such communications from you or from persons authorised by you, if you give prior written confirmation that it may correspond on that basis.
You hereby agree to notify Capita SIP Services immediately if you wish to change your contact details or if you become aware that the security of any methods of communication that you use to communicate with Capita SIP Services has or may have been compromised.
You hereby indemnify Capita SIP Services, on a continuing basis, against any Loss arising out of Capita SIP Services’ acting upon any communication that it reasonably believes to be from you or from a person authorised by you.
In respect of your Plan, Hoodless Brennan will communicate with you in accordance with the Hoodless Brennan Terms of Service.
13.3 Telephone calls
Capita SIP Services may record its telephone conversations with you for the purposes of training and the verification of facts. Capita SIP Services reserves the right to telephone you to discuss the administration of your Plan.
In respect of your Plan, Hoodless Brennan may record its telephone conversations with you in accordance with the Hoodless Brennan Terms of Service.
13.4 Confidentiality
Capita SIP Services undertakes not to disclose any confidential information (including personal data) about you coming into its possession during the lifetime of your Plan except that it may disclose such information:
(a) to your Adviser and Investment Manager; and/or
(b) to any third party expressly authorised by you; and/or
(c) where required to do so by law or by a regulator; and/or
(d) to any other third party in order to facilitate the administration of your Plan.
.Taking Benefits from your Plan
14. Timing and form of Benefits
14.1 Commencement of Benefits
You may currently elect to commence receiving Benefits from your Plan at anytime from your 50th birthday. You should however be aware that (under current HMRC Pension Regulations) as of 6 April 2010, Benefits will (unless your 50th birthday is prior to 6 April 2010) not ordinarily be payable prior to your 55th birthday.
The payment of Benefits will begin once Capita SIP Services receives all the documentation that it requires and has realised sufficient Assets to provide the monies required in respect of USP (see Section 17, below) or an Annuity purchase.
Upon your 75th birthday, any Assets remaining in your Plan will automatically be placed into ASP (see Section 18, below).
14.2 Early payment of Benefits
Benefits may only be paid from your Plan prior to your 50th birthday (but see Section 14.1, above) in any of the following circumstances:
(a) where the Benefits in your Plan relate to employment in a specialist occupation with a low retirement age (as set out in the HMRC Pension Regulations); or
(b) in the event of your ill health or serious ill health (as set out in HMRC Pension Regulations); or
(c) upon your death; or
(d) upon a Block Transfer from a Registered Pension Scheme where you had an unqualified contractual right to receive benefits from age 50.
14.3 Form of Benefits
Subject to Sections 14.5 and 14.6, below, you may elect to take Benefits from your Plan in the following forms:
(a) by purchasing an Annuity; or
(b) by electing to enter into USP; or
(c) by means of ASP.
14.4 Arrangements
If your Plan consists of a single Arrangement (see Section 1.11, above), you may elect to Vest it either in whole or in part.
Alternatively, if your Plan consists of more that one Arrangement (see Section 1.10, above), you may elect to Vest either all remaining Arrangements or any number of whole Arrangements, or part thereof, that have not already been Vested.
14.5 The Lifetime Allowance
When you take Benefits from your Plan Capita SIP Services is required by HMRC to test the value of the Assets being Vested against the Standard Lifetime Allowance.
If the value of the Assets to be Vested when aggregated with all other assets previously vested by you:
(a) including any assets previously vested in respect of the Scheme and all other Registered Pension Schemes; but
(b) excluding any Protected Rights, exceeds the Standard Lifetime Allowance, then a Lifetime Allowance Charge will apply, unless you have Protection against this (see Section 14.7, below)
Where funds are being Vested in the Scheme for the first time after 6 April 2006 in order to provide Benefits, Capita SIP Services will be required (provided that you have not previously vested any benefits in any other Registered Pension Scheme since 6 April 2006) to:
(a) place a value on any benefits previously vested; and
(b) deduct this value (in accordance with HMRC Pension Regulations) from your available Personal Lifetime Allowance when calculating whether a Lifetime Allowance Charge needs to be paid.
Capita SIP Services (as the Scheme Administrator) will deduct the Lifetime Allowance Charge from the Assets being Vested at the rates prescribed by the HMRC Pension Regulations and make the payment of such deduction to HMRC, except where the Lifetime Allowance Charge arises as a consequence of your death, in which case your legal personal representative is responsible for calculating the Charge and remitting it to HMRC.
Where, due to your failure to disclose to Capita SIP Services material and/or accurate information to enable Capita SIP Services to correctly calculate whether a Lifetime Allowance Charge is due, then Capita SIP Services may not be able to report or pay the correct Lifetime Allowance Charge to HMRC and you hereby indemnify Capita SIP Services against any Losses incurred as a result of your failure to provide such information. In such circumstances, HMRC may pursue you personally in respect of any Lifetime Allowance Charge payable.
14.6 Fund Designations in excess of your Personal Lifetime Allowance
Any part of any Fund Designation over and above your available Personal Lifetime Allowance will:
(a) (if paid as a lump sum) be paid net of tax at fifty-five percent (55%); and/or
(b) (if applied to a USP Fund, an ASP Fund or an Annuity) be calculated after the deduction of tax at twenty-five percent (25%); and/or
(c) (if paid as a transfer value to a Qualifying Recognised Overseas Pension Scheme) be paid net of tax at twenty-five percent (25%).
14.7 Protection against the Lifetime Allowance Charge
Pension rights accrued prior to 6 April 2006 may qualify for Protection against the Lifetime Allowance Charge where provided under the HMRC Pension Regulations.
Your pension rights may also qualify for Protection against the Lifetime Allowance Charge where (in respect of any Registered Pension Scheme) you;
(a) have received a pension credit on divorce or dissolution of a civil partnership; and/or
(b) are a Relevant Overseas Individual; and/or
(c) have transferred in benefits from a Recognised Overseas Pension Scheme.
Where you wish to claim Protection against the Lifetime Allowance Charge and the form of Protection required necessitates this to be claimed directly from HMRC, it is your responsibility to make such a claim.
Where Protection is dependent upon the issuance of a Protection Certificate, you must provide evidence of the certificate (or such other information as Capita SIP Services may require) to Capita SIP Services prior to completion of Vesting. Failure to provide such a certificate will result in Capita SIP Services treating the provision of Benefits as if no Protection applied.
Capita SIP Services will not be liable for any Loss resulting from any failure by you to claim or disclose to Capita SIP Services any entitlement to Protection or any delays in receiving confirmation from HMRC of your entitlement to claim such Protection.
15. Pension Commencement Lump Sums
15.1 Entitlement to a Pension Commencement Lump Sum
When setting up either an Annuity or USP Fund, you may also (subject to any restrictions imposed by the HMRC Pension Regulations) be entitled to take part of the Fund Designation as a Pension Commencement Lump Sum of up to twenty-five percent (25%) of the value of the Fund Designation.
In limited circumstances (permitted by the HMRC Pension Regulations) you may be able to take a Pension Commencement Lump Sum in excess of twenty-five percent (25%).
15.2 Timing of payment of Pension Commencement Lump Sums
Pension Commencement Lump Sums must be paid prior to the attainment of age 75 and in any event within three (3) months of (as applicable) the:
(a) USP Fund being created; or
Where you are eligible to take a Pension Commencement Lump Sum when setting up either an Annuity or USP but either:
(a) decline to do so; or
(b) take an amount less than the maximum permitted you will not be permitted (under current HMRC Pension Regulations) to request any unused element of the Pension Commencement Lump Sum at a later date.
A Pension Commencement Lump Sum cannot be paid after your 75th birthday. It is important, therefore, that you make arrangement to receive any Pension Commencement Lump Sum to which you may be entitled in advance of your 75th birthday, allowing sufficient time for disposal of any Assets that may need to be sold in order to provide the necessary cash.
Capita SIP Services will not allow the recycling (as defined in HMRC Pension Regulations) of Pension Commencement Lump Sums into the Scheme.
Where (due to your failure to disclose to Capita SIP Services material information in this regard) Capita SIP Services fails to report or pay (whether correctly or at all) any Unauthorised Payments Charge (where applicable) to HMRC:
(a) Capita SIP Services will have no liability to you in this regard; and
(b) you hereby indemnify Capita SIP Services against any Losses resulting from your failure to provide such information.
15.3 Recycling of Pension Commencement Lump Sums
Capita SIP Services will not allow the recycling (as defined in the HMRC Pension Regulations) of Pension Commencement Lump Sums in respect of the Scheme.
Generally, recycling will occur where:
(a) you receive (or are due to receive) a Pension Commencement Lump Sum which, when aggregated with any other Pension Commencement Lump Sums received by you in the previous twelve (12) month period exceeds one percent (1%) of the Standard Lifetime Allowance for that Tax Year, and
(b) as a result of the payment of a Pension Commencement Lump Sum, the amount of contributions paid into a Registered Pension Scheme in respect of you is significantly greater than it otherwise would be; and
(c) the additional contributions are made by you or by someone else, such as your employer;
(d) the recycling was pre-planned; and
(e) the cumulative amount of the additional contributions exceeds thirty percent (30%) of the Pension Commencement Lump Sum.
HMRC may pursue you personally in respect of any Unauthorised Payments Charge.
If you have any questions regarding recycling, please consult your Adviser.
15.4 HMRC tax charges on recycling Pension Commencement Lump Sums paid by the Scheme
Any Pension Commencement Lump Sum paid from the Scheme that is subsequently deemed to have been recycled (see Section 13.3, above) will be deemed an unauthorised payment by HMRC and:
(a) you may in consequence be liable to an income tax charge of up to fifty-five percent (55%) of the value of the Pension Commencement Lump Sum; and,
(b) Capita SIP Services, as Scheme Administrator will be subject to an HMRC scheme sanction charge of between fifteen percent (15%) and forty percent (40%) of the amount of the Pension Commencement Lump Sum.
15.5 Your indemnity to Capita SIP Services
Notwithstanding any declaration that you may have made in the Application Form (or elsewhere) regarding the recycling of Pension Commencement Lump Sums, you hereby indemnify Capita SIP Services against any:
(a) Unauthorised Payments Charge; and
(b) scheme sanction charge; and
(c) other Loss arising where Capita SIP Services fails (due to you having failed to disclose to Capita SIP Services material information in this regard) to report or pay (and whether correctly or at all) any Unauthorized Payments Charge.
16. Annuities
16.1 Purchase
When you wish to purchase an Annuity you will need to select an Annuity on the open market (Capita SIP Services does not provide Annuities) and advise Capita SIP Services of your selection. Once Capita SIP Services is satisfied that the selected Annuity complies with the Rules, it will then (subject to receipt of all other required documentation) arrange to purchase the Annuity from your chosen provider.
16.2 Taxation
Annuity payments are treated as earned income and taxed through PAYE.
16.3 Additional investment funds received after Vesting
Where:
(a) Capita SIP Services has acted in accordance with your instructions to fully Vest the entire value of your Plan; and
(b) further investment funds are subsequently received (for example, from your Plan custodian) (such as dividend payments from stock previously held)
Capita SIP Services will deal with such investment funds in accordance with the relevant provisions of the Rules (which usually will result in Capita SIP Services attempting to pass these investment funds onto your selected Annuity provider).
16.4 Testing Annuities against the Lifetime Allowance
If you purchase an Annuity with Assets, the amount Vested will be tested against your Personal Lifetime Allowance (see Sections 14.5 to 14.7, above) except where the Assets being Vested originate from:
(a) an Income Drawdown arrangement effected prior to 6 April 2006; or (b) an ASP; or
(c) USP funds which have previously been subjected to a Lifetime Allowance Charge or where you are entitled to Enhanced Protection.
17. USP
17.1 USP election
If you apply to go into USP (see Section 14.1, above), Capita SIP Services will send you a copy of its Unsecured Pension (USP) Terms and Conditions, which will set out the terms under which Capita SIP Services will provide you with USP.
The Unsecured Pension (USP) Terms and Conditions are supplemental to these Core Terms and Conditions. You hereby agree to be bound by the then current Unsecured Pension (USP) Terms and Conditions if you elect to enter into USP.
A copy of the Unsecured Pension (USP) Terms and Conditions is available on request from the Capita SIP Services Address.
17.2 Restriction of USP election
Capita SIP Services will not be able to take your Plan into USP unless it receives a correct and wholly completed:
(a) USP - Income Drawdown application from you at least one month prior to your 75th birthday; and
(b) Benefit Agreement Form from you at least one week prior to your 75th birthday.
17.3 Income Drawdown Transition to USP
If, prior to 6 April 2006, any Arrangements within your Plan have been taken into Income Drawdown, then these Arrangements will automatically from 6 April 2006:
(a) (in accordance with the HMRC Pension Regulations) be deemed to transfer into USP Funds; and
(b) be administered by Capita SIP Services in accordance with its Unsecured Pension (USP) Terms and Conditions.
18. ASP
18.1 Notice of ASP
Prior to your 75th birthday, Capita SIP Services will send you:
(a) notification that your Plan will be taken into ASP on your 75th birthday unless you elect an alternative to ASP (i.e. to purchase an Annuity or go into USP) prior to that date; and
(b) its then current Alternatively Secured Pension (ASP) Terms and Conditions (which will set out the terms under which Capita SIP Services will provide you with ASP) and will request confirmation from you of the type and basis of Benefits which you wish to receive from your 75th birthday.
In the event that you fail to provide Capita SIP Services with such confirmation:
(a) Capita SIP Services will put your Plan into ASP on zero income; and
(b) you will lose your right to any Pension Commencement Lump Sum; and
(c) the ASP Fund thus created will be administered in accordance with the then current Alternatively Secured Pension (ASP) Terms and Conditions.
The Alternatively Secured Pension (ASP) Terms and Conditions (the current version of which is available on request from the Capita SIP Services Address) form part of the Terms and Conditions.
18.2 ASP commencement
If you are a Member of the Scheme on your 75th birthday:
(a) all remaining Assets in your Plan will automatically be put into ASP in accordance with HMRC Pension Regulations; and
(b) you will lose any entitlement to any tax free cash lump sum payment; and
(c) Capita SIP Services will disinvest such Assets (on the basis set out in Section 11.2, above (subject that the thirty (30) day notice period referred to in 11.2(c) shall not apply)) as is necessary to cover any Lifetime Allowance Charge that may apply.
19. Triviality
19.1 Treatment of Trivial Funds
If, in respect of your Plan, you are entitled under the HMRC Pension Regulations to take a trivial commutation lump sum (as defined in the HMRC Pension Regulations) and if you elect to do so, Capita SIP Services will pay the value of your Plan as a lump sum (with an element subject to tax) instead of having to purchase an Annuity or going into USP.
20. Death Benefits
20.1 Nomination of your Beneficiaries
You may nominate any person(s) whom you wish to be taken into consideration as Beneficiaries and Capita SIP Services, as Trustee of the Scheme, will take your nomination(s) into consideration when determining Beneficiaries and the proportion of the Assets each Beneficiary is to receive.
Any such nominations (and variations thereof) must be notified to Capita SIP Services at the Capita SIP Services Address.
20.2 Benefits from Arrangements that are not Vested at the time of death
In respect of Arrangements that are not Vested (or have not been cancelled or transferred out) at the time of your death, the Trustee must provide Benefits to the Beneficiaries in accordance with the HMRC Pension Regulations in one or more of the following ways, by:
(a) purchasing a Dependant’s Annuity; and/or
(b) establishing a Dependant’s USP Fund; and/or
(c) establishing a Dependant’s ASP Fund; and/or
(d) paying a Lump Sum Death Benefit.
Payment of a Lump Sum Death Benefit in respect of Arrangements that are not Vested must be paid within two (2) years of the date of death and will necessitate a test against your Lifetime Allowance, unless the Lump Sum Death Benefit is classed as a trivial commutation lump sum death benefit or a winding up lump sum death benefit, as determined by the HMRC Pension Regulations.
Where the Lifetime Allowance test is required, this will be applied (as is the case for Vesting benefits) in accordance with Sections 14.5 and 14.7, above.
Capita SIP Services makes no representation as to whether any Benefits payable on death will be subject to any inheritance (or other such) tax, except as provided in Section 9.4 of the Alternatively Secured Pension (ASP) Terms and Conditions.
20.3 Benefits from Arrangements that are Vested at the time of death
In respect of Arrangements that are Vested at the time of your death, the method by which they were Vested will determine what, if any, death Benefits can be paid to your Beneficiaries.
Where such Arrangements have been used to purchase an Annuity, the Annuity provider will be solely responsible for paying any death Benefits in accordance with the terms and conditions of the Annuity purchased.
If such an Arrangement is in USP, the death Benefits are as set out in the Unsecured Pension (USP) Terms and Conditions. If such an Arrangement is in ASP, the death Benefits are as set out in the Alternatively Secured Pension (ASP) Terms and Conditions.
20.4 Determination of Beneficiaries and the form of Benefits payable
Subject to the HMRC Pension Regulations, the Trustee will exercise its absolute discretion in determining your Beneficiaries and the method by which Benefits are paid.
In exercising its discretion, the Trustee can only select Beneficiaries that fall into one or more of the following categories:
(a) any person, charity, association, club, society or other body (including trustees of any trust whether discretionary or otherwise) whose names the Member has notified to the Scheme Administrator in writing prior to the date of the Member’s death; and/or
(b) the Member’s surviving spouse or civil partner; and/or
(c) the parents and grandparents of the Member or the Member’s surviving spouse and any children and Remoter Issue of any of them; and/or
(d) the Member’s Dependants; and/or
(e) the Member’s legal personal representatives.
20.5 Disposal of Assets
Once it has received confirmation of your death, Capita SIP Services will not sell any Asset (other than to collect outstanding Charges, if necessary) until it has:
(a) satisfied all its requirements; and
(b) has determined:
(i) your Beneficiaries; and
(ii) that Dependant’s USP or Dependant’s ASP cannot or will not be used to provide Benefits for your Beneficiaries at which time Capita SIP Services will arrange for the sale of the remaining Assets as soon as is practicable. Please note that some Assets (for example Properties) can take longer to sell than others.
Until such time as your Beneficiaries have been determined, no other person can buy or sell Assets. Capita SIP Services will not be liable to your Beneficiaries for any Loss (including but not limited to Loss of investment value or missed investment opportunity) arising during this period.
20.6 Value and payment of Assets
Where some or all of the death Benefit is to be paid out by way of a Dependant’s Annuity or as a Lump Sum Death Benefit to a Beneficiary, then to the extent necessary, that Beneficiary’s share of the existing Assets will be realised as soon as practicable and the proceeds from the sale of these Assets will be payable to the:
(a) Beneficiary where a Lump Sum Death Benefit is being paid; and/or
(b) selected Annuity provider where a Dependant’s Annuity is being purchased.
Where some or all of the death Benefit is to be paid out to a Beneficiary by way of Dependant’s USP or Dependant’s ASP, then to the extent necessary, the Beneficiary’s share of the existing Assets will be realised as soon as practicable and the proceeds from the sale of these Assets will be used to provide Dependant’s USP or Dependant’s ASP for them.
In case you have a problem
21. The Financial Services Compensation (FSC) Scheme
21.1 The FSC Scheme and Capita SIP Services
As Capita SIP Services is a regulated company you may be entitled to compensation from the FSC Scheme if Capita SIP Services cannot meet its obligations to you.
Your entitlement will depend on the circumstances of your claim. The FSC Scheme only covers investment business as defined under the FSMA. Therefore, not all investments that can be held within your Plan will be covered by the FSC Scheme if Capita SIP Services cannot meet its obligations. For example, investments in commercial property are not covered by the FSC Scheme.
Capita SIP Services’ understanding is that where the FSC Scheme applies, the current level of compensation available is one hundred percent (100%) of the first £30,000 of covered investments and ninety percent (90%) of the next £20,000 (i.e. the maximum compensation is £48,000).
21.2 The FSC Scheme and your Assets
Where the provider of a financial product held by your Plan is unable to meet its obligations to your Plan and the product is covered by the FSC Scheme, then your Plan may be entitled to compensation. Where compensation is available, Capita SIP Services will make the claim on your behalf. The level of compensation available varies depending on the type of product held.
21.3 Contacting the FSC Scheme
For further details and information, please contact the FSC Scheme at:
Financial Services Compensation Scheme
7th Floor
Lloyds Chambers
1 Portsoken Street
London E1 8BN
Tel: 020 7892 7300
www.fscs.org.uk
22. Complaints
22.1 Making a complaint
If you wish to make a complaint relating to your Plan, you should notify Capita SIP Services. A copy of Capita SIP Services’ complaints procedure is available on request from ‘The Customer Liaison Manager’ at the Capita SIP Services Address.
22.2 Ombudsman Services
If having filed a complaint with Capita SIP Services you are dissatisfied with its response, you are normally entitled (depending upon the nature of your complaint) to refer the matter to either the Financial Ombudsman Service (‘FOS’) or the Pensions Ombudsman (‘PO’).
In the event of you making a complaint, Capita SIP Services will advise you to which ombudsman service you have the right to refer your complaint.
The FOS and PO are both independent statutory bodies that investigate and adjudicate on disputes between schemes and their members. Both services will however not become involved in disputes until such time as the Scheme’s own complaints process has been exhausted and no resolution can be agreed upon.
FOS contact details:
South Quay Plaza
183 Marsh Wall
London E14 9SR
Tel: 0845 080 1800
PO contact details:
11 Belgrave Road
183 Marsh Wall
London E14 9SR
Tel: 020 7834 9144
22.3 Pensions Advisory Service
You may also at any time refer any problem, complaint or dispute that you may have about the Scheme or your Plan to the Pensions Advisory Service (‘PAS’). PAS are an independent non-profit organisation that provide information and guidance on pensions and who assist pension scheme members who have a problem, complaint or dispute with their pension scheme.
PAS contact details:
Pensions Advisory Service
11 Belgrave Road
London
SW1V 1RB
Tel: 0845 601 2923
Varying/ending your Plan
Variation
23.1 Variation of the Terms and Conditions
Subject to the provisions of Sections 23.2 and 23.3, below, Capita SIP Services may vary the Terms and Conditions at any time:
(a) upon provision to you of thirty (30) days prior written notice; and/or
(b) (where such thirty (30) day period is not possible or practical, for example due to changes in applicable law) by notice in writing with immediate effect.
23.2 Notice of variation
When notifying you of any variation to the Terms and Conditions, Capita SIP Services will always do so in writing, which notice may be in the form of: (a) a revised version of the Terms and Conditions document(s) being varied; and/or (b) an explanatory letter setting out the nature of such variations.
23.3 Variation of the Scheme
The Trust Deed and Rules and the operation of the Scheme may be varied:
(a) by the Trustee from time to time; and/or
(b) by Capita SIP Services due to changes in legislation, regulation or commercial environment.
Changes to the Trust Deed and Rules may necessitate changes to the Terms and Conditions and while Capita SIP Services will endeavour to provide you with prior written notice of any such change (and notwithstanding the provisions of Section 23.1, above) it reserves the right to effect such changes without the provision of prior notice (unless such changes will have a material impact upon the operation of your Plan, in which case Capita SIP Services will give you thirty (30) days notice of any such change).
Cancellation Rights
24.1 Your right to cancel
When Capita SIP Services accepts your Application, it will issue you with a Cancellation Notice which will specify the Cancellation Period (currently thirty (30) days) during which you may change your mind about establishing your Plan.
The Cancellation Period begins on the date Capita SIP Services accepts your Application.
24.2 How to cancel
If you decide that you wish to withdraw your Application, you must:
(a) complete the Cancellation Notice; and
(b) send the Cancellation Notice to the Capita SIP Services Address before the end of the Cancellation Period, advising that you wish to exercise your right to cancel.
If you do not wish to cancel your Application, simply disregard the Cancellation Notice.
24.3 Costs incurred during the Cancellation Period
There is no Charge for canceling your Application. However, Capita SIP Services reserves the right to deduct from your Plan any Charges reasonably incurred and payable (and whether to Capita SIP Services or otherwise) in consequence of your Application.
Upon receipt of a duly completed Cancellation Notice within the Cancellation Period, Capita SIP Services will then:
a) refund any Contributions received; and
(b) return any transfer values received.
The value of Contributions refunded and transfers returned will be subject to investment fluctuations if Assets have been purchased during the Cancellation Period. As a result, the value of the refund/return may be higher or lower than the amount originally invested.
25. Term and Termination
25.1 Term
In respect of your Plan, the provisions of the Terms and Conditions documents (to the extent that they are applicable to your Plan) will remain in full force and effect until terminated (see Sections 25.2, 25.3 and 25.4, below).
25.2 Termination (where no Assets are in USP or ASP)
The provisions of the applicable Terms and Conditions documents will remain in full force and effect until the Terms and Conditions are terminated:
(a) by you Transferring Out to another Registered Pension Scheme all the Assets within your Plan; or
(b) upon all Assets being exhausted; or
(c) by you purchasing an Annuity using all the Assets within your Plan; or
(d) by your death; or
(e) by Capita SIP Services ceasing to be the Trustee and/or Scheme Administrator; or
(f) by you terminating the services of Hoodless Brennan as your Investment Manager; or
(g) by Capita SIP Services upon the winding-up or other termination of the Scheme.
25.3 Termination (where Assets are in USP)
The provisions of the Unsecured Pension (USP) Terms and Conditions will remain in full force and effect until terminated by:
(a) the occurrence of one of the termination events referred to in Section 25.2, above; or
(b) you Transferring Out (or otherwise exhausting) all USP Funds within your Plan; or
(c) the purchase of an Annuity with the entire USP Fund.
25.4 Termination (where Assets are in ASP)
The provisions of the Alternatively Secured Pension (ASP) Terms and Conditions will remain in full force and effect until terminated by:
(a) the occurrence of one of the termination events referred to in Section 25.2, above; or
(b) you Transferring Out (or otherwise exhausting) all ASP Funds within your Plan; or
(c) the purchase of an Annuity with the entire ASP Fund.
25.5 Post termination
Termination of the Terms and Conditions (or any part thereof) will be without prejudice to:
(a) the completion of transactions already initiated; and
(b) the completion of obligations clearly intended to survive termination; and
(c) the undertaking of transactions necessary to terminate your Plan; and
(d) the production by Capita SIP Services of any statements and/or documents that it is required in such circumstances to produce (and whether to you or to any third party).
Capita SIP Services will continue to operate the bank accounts relating to your Plan for the purpose of settling or receiving monies in respect of transactions already initiated and paying any Charges due to Capita SIP Services or other parties.
25.6 Termination costs
You will not be required to make any additional payment to Capita SIP Services in respect of the termination of your Plan (or of your USP Fund and/or ASP Fund) except that Capita SIP Services may charge you for any:
(a) outstanding or periodic Charges accrued and due; and/or
(b) additional Charges Capita SIP Services necessarily incurs on termination of your Plan (or of your USP Fund and/or ASP Fund); and/or
(c) Losses necessarily realised in settling or concluding outstanding obligations.
Miscellaneous provisions
26. Miscellaneous Provisions
26.1 Force Majeure Events
Capita SIP Services will not be deemed to be in breach of the Terms and Conditions or otherwise liable to you (or to any third party) for any failure or delay in it performing its obligations under the Terms and Conditions due to a Force Majeure Event, provided always that Capita SIP Services uses its reasonable endeavours to:
(a) (where possible) bring the Force Majeure Event to an end; and
(b) (whilst the Force Majeure Event is continuing) to mitigate the impact of the Force Majeure Event.
26.2 Invalidity and severability
If at any time any provision of the Terms and Conditions (or any rights and/or obligations thereunder) is:
(a) found by any Court, tribunal or administrative or regulatory body of competent jurisdiction to be in part illegal, invalid or unenforceable in any respect; and/or
(b) in conflict with the HMRC Pensions Regulations (or any other applicable law or regulation) , then that provision shall be deemed removed from the Terms and Conditions provided that such removal will not affect any other provisions of the Terms and Conditions which will remain in full force and effect.
26.3 Contracts (Rights of Third Parties) Act 1999
You hereby agree with Capita SIP Services that no provision of the Terms and Conditions will be enforceable by any party (other than you and Capita SIP Services) by virtue of the Contracts (Rights of Third Parties) Act 1999.
26.4 Limitation of liability
Subject to the provisions of the following two paragraphs, unless explicitly stated otherwise in relation to any specific provision, Capita SIP Services shall have no liability under the Terms and Conditions (including under these Core Terms and Conditions) for any Loss except where such Loss results from Capita SIP Services’:
(a) breach of trust, knowingly and intentionally committed; and/or
(b) negligent acts and/or omissions provided always that such liability will only be in respect of direct Loss and Capita SIP Services shall have no liability to any party for any indirect or consequential Loss whatsoever.
Without prejudice to the generality of the above paragraph, in respect of third parties appointed by Capita SIP Services in respect of your Plan other than upon your instructions, Capita SIP Services shall be responsible for any direct Loss arising from the acts or omissions of any such third party to the extent that such Loss applies to you, your Plan or to the Scheme.
Capita SIP Services’ liability under the Terms and Conditions shall in any event be limited to the value of the Plan in respect of which the relevant Loss has arisen.
26.5 Changes to your circumstances
You must advise Capita SIP Services immediately if there are any relevant changes to your personal circumstances. If you are in doubt as to whether a change is relevant, please contact Capita SIP Services at the Capita SIP Services Address.
26.6 Law and jurisdiction
The Terms and Conditions are subject to and are to be construed in accordance with the laws of England and Wales and you and Capita SIP Services each hereby irrevocably agree:
(a) that the courts of England and Wales will have exclusive jurisdiction to settle any dispute which may arise out of or in connection with the Terms and Conditions; and
(b) to submit to the jurisdiction of such courts and waives any objections to any proceedings in any such courts on the ground of venue or on the ground that the proceedings have been brought in an inconvenient forum.
APPENDIX 1 - Definitions Schedule
1. Introduction
The contractual relationship between:
(a) you (as a Member of the Scheme); and
(b) In respect of the Scheme Capita SIP Services (as the Trustee and Scheme Administrator of the Scheme) in respect of the Scheme (and the rules governing the operation of your Plan) are set out in a series of documents referred to as the Terms and Conditions (see Section 1.1 of the Core Terms and Conditions).
This document, referred to as the Definitions Schedule, forms part of the Terms and Conditions and sets out the defined words and expressions used in each of the Terms and Conditions documents (see Section 1.6 of the Core Terms and Conditions).
Copies of all the above Terms and Conditions documents are available upon request from the Capita SIP Services Address and are on the Hoodless Brennan Website.
2. Use of defined terms and expressions
Capita SIP Services has produced this Definitions Schedule to assist you to understand and interpret the Terms and Conditions.
Each defined word and expression set out in this Definitions Schedule:
(a) is used consistently throughout the Terms and Conditions;
(b) is highlighted throughout the Terms and Conditions using text that is bolded and italicized; and
(c) may be applied in the singular or the plural.
Please note that:
(a) not all defined words and expressions are used in all Terms and Conditions documents; and
(b) certain Property related definitions are defined and used only in Section 10 of the Core Terms and Conditions.
3. The defined terms and expressions,
In each Terms and Conditions document the words and expressions set out below shall have the meanings set out below:
‘Adviser’ means, your financial adviser;
‘Alternatively Secured Pension (ASP) Terms and Conditions’ means, means, the terms and conditions subject to which any Arrangement is taken into ASP, as varied by Capita SIP Services from time to time;
‘Annual Allowance’ means, the amount designated by Her Majesty’s Treasury from time to time that can be paid into all Registered Pension Schemes in respect of any individual in relation to a given Tax Year without incurring any annual allowance tax charge;
‘Annuity’ means, a non-assignable lifetime annuity as permitted by the HMRC Pension Regulations;
‘Application’ means, a Member’s application to join the Scheme;
‘Application Form’ means, the application form published by Hoodless Brennan (and approved by Capita SIP Services) from time to time and completed by Members as part of their Application to join the Scheme;
‘Arrangements’ means, the segment(s) into which the assets of a participant in the Scheme are subdivided (see the Core Terms and Conditions);
‘ASP’ means, an alternatively secured pension (as defined by the HMRC Pension Regulations) being, in the context of the Scheme, an 'Arrangement' involving the setting up and payment of Income Drawdown to a Member, on or after that Member’s 75th birthday;
‘ASP Fund’ means, in respect of each Arrangement, all Assets held in a Plan that have been designated to provide a Member (age 75 and over) with ASP;
‘ASP Income’ means, income paid to a Member from an ASP Fund, in accordance with the HMRC Pension Regulations;
‘ASP Review’ means, the periodic review of a Member’s ASP Fund (see Section 5.3 of the Alternatively Secured Pension (ASP) Terms and Conditions);
‘Asset’ means, an investment made (including cash deposits) in respect of and forming part of a Plan;
‘BACS’ means, the UK ‘Bankers Automated Clearing System’;
‘Beneficiary’ means, any person(s) entitled to benefit from your Plan in the event of your death who:
(a) falls within the classes of potential beneficiaries listed in Section 20.4 of the Core Terms and Conditions; and
(b) is subsequently determined by the Trustee, at its sole discretion, to benefit from your Plan;
‘Benefit’ means, the provision for you or one or more Beneficiaries (as permitted by the HMRC Pension Regulations) from your Plan of:
(a) an Annuity; and/or
(b) an ASP Fund; and/or
(c) a USP Fund; and/or
(d) a lump sum payment;
‘Benefit Agreement Form’ means, the form published by Capita SIP Services from time to time and completed by Members as part of their application to join the Scheme;
‘Block Transfer’ means, a transfer from one pension scheme to another pension scheme which:
(a) is a single transaction;
(b) (in respect of any individual) involves the transfer of all the sums and assets held in respect of that individual within the pension scheme from which the transfer is made;
(c) relates to two or more members of the pension scheme from which the transfer is being made;
(d) (in respect of each transferring member of the scheme from which the transfer is being made) that are either:
(i) not a member of the pension scheme to which the transfer is made; or
(ii) (if they are a member of the scheme to which the transfer is being made) they have not been a member of that pension scheme for longer than twelve (12) months.
‘Borrowing’ means, in respect of a Plan, borrowing by the Trustee on behalf of a Member, where the borrowing (and whether in the form of a mortgage, overdraft or otherwise) is to be repaid from the Plan;
‘Cancellation Notice’ means, a notice provided by Capita SIP Services to a Member, advising that Member of his/her Cancellation Rights;
‘Cancellation Period’ means, the period specified in any Cancellation Notice during which the Member may exercise their Cancellation Rights;
‘Cancellation Rights’ means, the rights of a Member within the Cancellation Period to withdraw their application to (as applicable) join the Scheme or enter into USP;
‘Capita SIP Services Address’ means, Capita SIP Services’ principal place of business, being 141 Castle Street, Salisbury, Wiltshire, SP1 3TB, UK;
‘Capita SIP Services Charges’ means, those Charges payable to Capita SIP Services in respect of a Plan and whether as:
(a) set out in the Charges Schedule; or
(b) otherwise payable
and as varied from time to time;
‘Capita SIP Services Website’ means, the website maintained by Capita SIP Services from time to time, currently being www.capitasipservices.com;
‘Charge’ means (as the context requires), any:
(a) Capita SIP Services Charge; and/or
(b) other commissions, fees, charges, costs, disbursements, expenses, taxes, fines and such other liabilities as arise (and whether payable to Capita SIP Services or otherwise) in relation to the operation of a Plan (including all costs of Property ownership, leasehold or freehold, and costs associated with the obligations in any lease) and as varied from time to time;
‘Charges Schedule’ means, the schedule of Charges (referred to on the relevant document as the ‘Charges and Commissions Schedule’) payable and applicable to a Plan, as varied from time to time;
‘Charitable Lump Sum Death Benefit’ means, a lump sum Benefit paid by the Trustee from the Scheme to a Registered Charity nominated either by:
(a) the Member; or
(b) (if the Member made no nomination) by a Dependant
following the death at age 75 or after of the Member the Dependant;
'Comprehensive SIPP' means the Hoodless Brennan Self Invested Personal Pension with a wide Permitted Investment range.
‘Connected Person’ has the meaning given to that term in Section 839 of ICTA;
‘Contribution’ means, a payment into a Plan that is:
(a) accepted by Capita SIP Services; and
(b) is permitted under the HMRC Pension Regulations;
‘Core Terms and Conditions’ means, the basis terms and conditions of the Scheme, being part of the Terms and Conditions, subject to which Capita SIP Services (as Trustee and Scheme Administrator of the Scheme) will administer your Plan (see section 1.3 of the Core Terms and Conditions);
‘CREST’ means, the computer-based system which enables securities to be held and transferred in uncertificated form and which is operated by CRESTCo Limited;
‘Dealing Service’ means, the investment dealing services provided by Hoodless Brennan to Members of the Scheme pursuant to the Hoodless Brennan Terms of Service;
‘Definitions Schedule’ means, this schedule of defined words and expressions;
‘Dependant’ means, as at the date of a Member’s death:
(a) the Member’s spouse or civil partner; and/or
(b) any child of the Member who is under 23 years of age or who is over 23 years of age and was dependant on the Member because of a physical or mental impairment; and/or
(c) any other individual who was financially dependant on the Member;
‘Dependant’s Annuity’ means, following the death of a Member, a non-assignable lifetime annuity payable to a Dependant, as permitted by the HMRC Pension Regulations;
‘Dependant’s ASP Fund’ means, an ASP Fund that has been provided (in accordance with the provisions of paragraphs 26 and 27 of Schedule 28 to the Finance Act 2004) to a Dependant where that Dependant is aged 75 or over;
‘Dependant’s USP Fund’ means, in respect of each Arrangement, all Assets in a Plan that have designated to provide a Dependant (whilst aged under 75) with USP Income,
‘Designated Account’ means, an RBS bank account (or such other account as Capita SIP Services’ discretion may be a pooled account, as may from time to time be selected by Capita SIP Services) designated as the initial cash account of a Plan;
‘Designated Brokerage Account’ means, the brokerage account opened and maintained by Hoodless Brennan in respect of a particular Plan;
‘Designated Property Account’ means, the designated account opened by the Trustee in relation to a specific Property held within a Plan;
'Easy Builder SIPP' means the Hoodless Brennan Self Invested Personal Pension with a restricted Permitted Investment range. ‘Employer Contribution’ means, a permitted Contribution made by a Member’s employer in respect of that Member;
‘Enhanced Protection’ means, in respect of all Registered Pension Schemes, complete protection against the Lifetime Allowance Charge of:
(a) a person’s benefits accrued prior to the 6th of April 2006; and
(b) any associated fund growth accrued after 6th April 2006;
‘Finance Act 2004’ means, the provisions of Part 4 of the Finance Act 2004 and any variations and amendments thereto and any secondary legislation and regulations thereunder;
‘Force Majeure Event’ means, any cause preventing Capita SIP Services from performing any or all of its material obligations under this Agreement which arises from or is attributable to acts, events, omissions or accidents beyond the reasonable control of Capita SIP Services including, without limitation, acts of God, war or national emergency, acts of terrorism, riot, civil commotion, malicious damage, compliance with any law or governmental order, rule, regulation or direction, fire, explosion, flood, storm, or epidemic (including any interruption by such events to electronic or other automated systems used in connection with the services provided by Capita SIP Services to Members but only where the interrupt
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