Pension Protection Levy 


The pension protection levy is one of the ways that the PPF funds the compensation payable to members of schemes that transfer to the Pension Protection Fund.

2017/18 Levy


On 15 December we made available provisional rules for 2017/18 and the Pension Protection Levy Policy Statement. The Policy Statement can be found 
here.

Changes for 2017/18 levy are limited but include an opportunity to notify Experian where a change in accounting standards impacts the calculation of trend variables, which compare data on a new accounting standard in the most recent accounts to that on a different accounting standard in a previous year. This is to allow the comparison to be done on the same basis. Certification will be available for all trend variables. A Certificate and guidance on its use is available on the Pension Protection Score Portal.

We indicated in December 2016 that it was our firm intention that these provisional rules would not be altered, apart from to include additional rules relating to eligible schemes which cease to have a substantive employer after a restructuring of their pension arrangements. Schemes should therefore feel able to take appropriate steps based upon the provisional rules.

16 January 2017: We have now added the accounting standard change certificate and guidance to the 2017/18 Determination Page and have added to the Insolvency Risk guidance pages. We have also corrected two minor drafting errors – to the definition of the accounting standard change certificate in the main part of the Provisional Determination and to the year reference on the Rent Deposit Mortgage Exclusion Certificate for 2017/18.

20 February 2017: As we indicated in December 2016, we have now published an additional consultation document which is inviting comments solely on new rules for schemes without a substantive sponsor. The deadline for comments is 5pm on 6 March 2017 and we will publish finalised rules by 31 March 2017.

Third Levy Triennium 

The third levy triennium will cover the levy years 2018/19 to 2020/21. On 28 July 2016 we published an update on the areas we plan to review within the Third Levy Triennium. The document can be found here.

The guidance below reflects the 2017/18 rules except for those relating to invoicing and below which will be updated closer to the start of invoicing for 2017/18.

 Section

 Includes Information About

About the Levy 

Scheme-based levy, risk-based levy and other levies

   Specific Levy Year Information

Key information for current and past years

Who Has to Pay

Eligibility and Schemes in Assessment

How the Levy Works

Information used, transformation of s179 data and key elements of calculation

Insolvency Risk 

Calculation of insolvency risk, PPF-specific model and the Pension Protection Score Portal

   Multi-employer Schemes

Use of weighted levy rates for multi-employer schemes

   Incomplete Mean Scores

Use of averaged calculations where Mean Scores not available for all employers

   Scheme Structure

Scheme structure factors for Partial Segregation, Last Man Standing and Centralised Schemes

Levy FAQs

Levy FAQs

Underfunding

How underfunding is calculated

Data Deadlines

Data Deadlines for the 2017/18 Levy

Risk Reduction

Introduction

   Contingent Assets

Types of Contingent Assets and Guarantor Levy Band adjustment

   Deficit Reduction Contributions

Basis for DRC recognition in levy calculations

Block Transfers

Certification of Block Transfers

Invoicing

Invoicing the 2017/18 levy

   Querying Your Invoice

What to do if you think your invoice is incorrect

Levy Waivers

Who can apply for a waiver and how to do it

Reviews and Appeals

What rights of appeal exist and what is the scope, deadline for appeal etc?

 

 

Additional Guidance

 

Levy Data Correction Principles
Guidance on ABCs
Guidance on Bespoke Investment Risk Calculation
Guidance on Block Transfers
Guidance on Contingent Assets
Guidance on Exclusion of Mortgages

 

Trustees and employers can check their Experian data and scores by logging on to the Pension Protection Score Portal