The 2020/21 levy rules
Our rules and guidance for the 2020/21 levy year were published on 16 December 2019, these set out how we will calculate the levy that will be invoiced in Autumn 2020.
These were published following a consultation we launched in September and we set out our conclusions in our policy statement.
Insolvency Risk Mean Scores and adjustments for the cost of GMP equalisation
Defined benefit pension scheme employers may have to include a one-off adjustment in their annual accounts for periods ending on or after the end of October 2018. This is due to the outcome of a court case concerning Guaranteed Minimum Pensions (GMP) equalisation. The decision may impact past as well as current and future years’ scheme benefit liabilities for employers.
If your annual accounts include an adjustment for the cost of GMP equalisation this could lead to a higher insolvency risk score. We expect, for a small number of scheme employers, this may result in their insolvency risk score moving into a higher risk levy band. An adjustment of your Mean Score can be requested if the following circumstances apply:
- a specific amount can be identified in accounts used to calculate one or more Monthly Scores that solely relates to a GMP equalisation adjustment
- allowing the amount of that adjustment to be disregarded would result in the company being viewed as reporting a pre-tax profit rather than a loss
- allowing the adjustment would result in a change of Mean Score to a levy band with a lower levy rate
If you think you meet these conditions you can request a recalculation of your Mean Score. You should apply within 28 days of Experian publishing Mean Scores for 2020/21 (expected to be early July 2020), and include supporting evidence.
What you need to do if you think you’re affected
You don’t need to do anything yet. Before we publish the Mean Scores (expected in early July 2020), we’ll put a simple application form, and guidance on how to complete it, on these pages.
Please note this doesn’t mark a general departure from our view that information as reported in accounts should be used in scoring.
Help make sure your levy is accurate
We plan to start invoicing for levy year 2020/21 in Autumn 2020, using the information you give us, Experian and The Pensions Regulator.
To make sure your levy is accurate, read more on checking your information.
Update your billing address
We want to help schemes ensure that their levy bills go to the most appropriate address.
If you would like the invoice to be sent to a named contact, please enter this information in the billing address section on the Pensions Regulator’s website (Exchange). This can be found under part 2.3, titled ‘Scheme Details’
If this information isn’t updated, the PPF levy invoice will be addressed and sent to the scheme trustees at the registered scheme address.
The PPF levy invoice is not sent to scheme levy contacts listed in Exchange.
Learn about key deadlines
You can use our levy timeline to keep up to date with levy deadlines for each levy year.