HM Revenue & Customs is asking for far more information and documents when authorising new small self-administered schemes, according to Dentons Pension Management.
The pensions provider found the government is enhancing the current system and putting in place a more robust checking procedure to prevent inappropriate Ssas' being established.
HM Revenue & Customs is now issuing a notice to provide information and produce documents about an application to register a pension scheme and indicates a change in stance.
The request is in line with the check and register process introduced in 2014.
Earlier this month, the government investigated whether to limit the right of individuals to transfer their pension to some occupational schemes, as well as a ban on pension cold calling, to stop fraudsters.
Research by the Money Advice Service suggested there could be as many as eight scam calls every second - the equivalent of 250 million calls per year.
Additionally, Citizens Advice have calculated that 10.9m consumers have received unsolicited contact about their pension since April 2015.
The same research showed there were 30,000 defined contribution scheme transfers in 2015 to 2016, representing £1bn of assets.
Additionally, industry estimates suggest fraudsters could be behind as many as one in 10 pension transfer requests, while individuals reported nearly £19m in suspected pension liberation fraud between April 2015 and March 2016, twice as much as for the same period in 2014 to 2015.
Martin Tilley, director of technical services at Dentons, said pension scams have been on the increase in recent years, especially in light of pension freedoms and people have lost their life savings.
"The government is so concerned about this that they issued a consultation on 5 December looking at a potential ban on cold calling.
"This can only be a good thing for the industry, advisers and for the end consumer.
"HM Revenue & Customs is now issuing a notice to provide information and produce documents about an application to register a pension scheme and indicates a change in stance by HM Revenue & Customs. The request is in line with the check and register process introduced in 2014."
Mr Tilley added the additional information now required by HM Revenue & Customs will have an impact on the time it takes to register a Ssas scheme and it will be important for advisers and administrators to explain this to clients to contain any frustration.
"In addition, the bank account cannot be created until the scheme is registered, meaning the scheme cannot accept contributions or transfers. So, for clients approaching their company year end that may be looking to make corporate contributions into the new scheme, may have to take this into account.
“The statistics on the potential numbers of scams is eye watering and anything that can be done to stop this trend in its tracks can only be welcomed. HM Revenue & Customs and the FCA are working to improve the situation for consumers and this will have a positive impact on the industry.”
ruth.gillbe@ft.com
