A surplus from a pension fund scheme can carry a tax liability. A tax charge is provided for under section 601 of the Income and Corporation Taxes Act 1988. It applies to all payments to an employer from the funds of an exempt approved pension scheme, as the Scottish Transport Group schemes are and the National Bus Company schemes were.
The tax payable on payments to pensioners will depend on the nature of the payment and the personal tax circumstances of the individual. Payments to Scottish Transport Group pensioners have not yet been finalised by the Scottish Executive.