# The Registered Pension Schemes (Prescribed Interest Rates for Authorised Employer Loans) Regulations 2005, Note: Explanatory note


(This note is not part of the Regulations)
Section 179 of the Finance Act 2004 prescribes conditions which must be met before a loan made by a registered pension scheme to a sponsoring employer is an authorised employer loan. One of the conditions is that the rate of interest payable on the loan is not less than the rate prescribed by regulations. These Regulations prescribe that rate.
Regulation 1 provides for the citation and commencement of the Regulations.
Regulation 2 defines certain expressions used in the Regulations and provides a method of determining the relevant interest rate, which is an average of the base rates of a specified group of banks.
Regulation 3 prescribes the rate of interest for the purposes of section 179 for a period beginning on the sixth working day of one month and ending on the day preceding the sixth working day of the next month as 1% more than the relevant interest rate found on the reference date preceding the start of the period.
A regulatory impact assessment in respect of the provisions of Part 4 of the Finance Act 2004 and subordinate legislation under it was published by the Board of Inland Revenue on 8 April 2004, and is available on the Inland Revenue website at www.inlandrevenue.gov.uk/ria/simplifying-pensions.pdf or (for hard copies) by writing to the Ministerial Correspondence Unit, Capital and Savings 1st Floor Ferrers House, PO Box 38, Castle Meadow Road, Nottingham, NG2 1BB.

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Source: https://www.legislation.gov.uk/uksi/2005/3449/note (the official version)
Page: https://openlegislation.uk/registered-pension-schemes-prescribed-interest-rates-for-authorised-employer-loans-regulations-2005/note
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.