Members' FAQs
Frequently Asked Questions (last updated May 2008)
Scheme membership and contribution rate Pensionable service and estimate of retirement benefits New Average Salary calculation Increasing my benefits in the scheme Additional Pension Nomination of a Spouse or Partner Pensions on divorce and pension credit members AVCs (Additional Voluntary Contributions) Leaving the TPS Retiring from the scheme Converting Pension to a Tax Free Lump Sum Pension benefits Ill Health retirement Working after retirement Phased retirement Maternity absence My Pension OnlineScheme membership and contribution rate
Q. How much are my contributions to the TPS?
A. The scheme reforms and improvements mean the contribution rate payable by members from 1 January 2007 is 6.4%.
Q. I was a member of the TPS before 1 January 2007. Can I transfer my service and contributions to the arrangement for new entrants?
A. No. The arrangements for new entrants are for those who first enter the TPS on or after 1 January 2007 and for the future service of existing members who return to the scheme after a break of more than five years.
Q. What is payable when I die?
A. When you die a lump sum death grant of three times your average salary will be paid if you have not retired and a pension may be paid to your dependants. For further information about death grants and pensions, see the Survivors and death benefits leaflet.
If this did not answer your query, please check our FAQs index or Contact us.
Back to the topPensionable service and estimate of retirement benefits
Q. What are the "days out" showing on my estimate of benefits?
A. Days out are days which your employers have confirmed were without pay. These could be strike days or unpaid leave. Your employers do not provide reasons for these absences. If you wish to query them, please contact your employer direct.
Q. Why is there teaching service missing from my record of service?
A. Teachers' Pensions are not the direct employer of teachers and therefore rely on teachers' employers to provide service and salary details. This information is provided annually by employers and therefore if the information for the last financial year is missing from your statement of service this is because the information has yet to be updated from your employer. If service is missing from an earlier period you may wish to contact the relevant employer asking them to notify TP of the appropriate details.
Q. What is the impact of the Scheme Review on part time work?
A. If you started a new contract on or after 1 January 2007, you will automatically become a member of the TPS. If there is a change in contract and you do not wish to contribute you will need to formally ‘opt out’ of the scheme. If you do not change your contract and have not previously elected to join the scheme, you will not automatically become a member of the TPS, but you can still join by making an election to contribute to the TPS.
Q. What is LTA and why is this figure quoted on my Estimate of Benefits?
A. The Finance Act 2004 introduced a single tax regime that applies to all UK tax-privileged pensions. This new regime introduced a Lifetime Allowance (LTA), which is the total allowable value of all privileged pensions from all sources. If the value of your total pensions, within the current limits, exceeds the LTA, you will have to pay additional tax, called a recovery charge, of 25% on the excess. The estimate of retirement benefits provides you with details of the value of your benefits available from this scheme as a proportion of the Lifetime Allowance.
Q. Why have I been entered in the TPS?
A. From 1 January part time as well as full time employees are automatically entered into the TPS unless they opt out.
Q. One of my employers has entered me in the TPS but my others have not, what should I do?
A. All your employers should have entered you into the TPS. Please advise your other employers to deduct contributions. If you subsequently opt out, you must provide all employers with a copy of your opt out acceptance letter from TP.
Q. Will a retrospective part time election be accepted?
If you had previous pensionable employment prior to 1 January 2007, your service can be backdated provided you and your employer agree to pay any arrears of contributions that may be due.
If you are a new entrant and do not have any pensionable service prior to 1 January 2007, your service cannot be backdated. A service credit equivalent to the retrospective service may be provided, but a valid reason will need to be supplied by your employer and they will need to provide evidence that contributions have previously been deducted. All service in these cases will carry a NPA of 65.
Q. If I have previous service in the TPS and opt-out, what happens to my previous service?
A. It will continue to remain to your credit as accrued pension.
Q. Are there any restrictions to the amount of service that can be used in the calculation of my retirement benefits?
A. The maximum total pensionable service that can be used in the calculation of retirement benefits is 45 years.
A further restriction may also apply as follows:
- If you do not have any pensionable service after 01.01.2007 and accrue 40 years or more before reaching age 60 your benefits will be restricted. Your pension and lump sum will be based on 40 years plus any pensionable service accrued after reaching age 60.
- If you do have pensionable service after 01.01.2007 and have accrued 40 years pensionable service prior to 01.01.2007 your benefits will be restricted. Your pension and lump sum will be based on 40 years plus your pensionable service accrued on or after 01.01.2007 (or pensionable service accrued since your 60th birthday if that is earlier than 01.01.2007).
New Average Salary calculation
Q. How is the new average salary calculated?
A. The fact sheet Average Salary describes the different methods of calculating average salary. The average salary used to calculate your benefits will always be the best one depending upon your individual circumstances.
Q. Will the new average salary be shown on my estimate of benefits?
A. The most beneficial calculation will be shown on the paper copy that is produced which includes your service to 31 March 2007 but a more detailed version will be available on the version available on the website. To register, please click on the section headed My Pension Online.
Q. What salary will be used to calculate my benefits if I work part time?
A. The full time equivalent of your salary will be used to calculate your benefits. Further information can be found in the fact sheet Working part time before retirement.
If this did not answer your query, please check our FAQs index or Contact us.
Back to the topIncreasing my benefits in the scheme
Q. How can I maximise my benefits with the TPS?
A. You can buy extra pension or you can take out an Additional Voluntary Contribution (AVC). If you buy additional pension you can either pay a lump sum or have additional contributions deducted from your salary. For further information, see the Additional Pension fact sheet. A calculator is available on the TP website that can be used to provide an indication of costs. If you want to take out an AVC the in-house provider is Prudential, but you can use other providers. For more information, contact the Prudential at
Teachers’ AVC Department
Prudential
Craigforth
Stirling
FK9 4UE
Telephone: 0845 0700 007
Website: http://www.pru.co.uk/teachers/
Following changes introduced by Her Majesty’s Revenue and Customs (HMRC) in April 2006, you are able to save in more than one pension scheme at the same time.
Q. Can I transfer my pension credit to the TPS from another scheme?
A. When you join the TPS, you can transfer pension credit from a previous scheme including an overseas scheme, as long as the previous scheme meets Her Majesty’s Revenue and Customs (HMRC) requirements and you apply for a transfer within 12 months of entering pensionable employment. Ask your employer for a transfer in pack, which includes forms for you to complete and request for information from your previous pension provider. For further information about transfers, see the Transfers In leaflet.
Back to the topAdditional Pension
Q. What is APB?
A. APB is Additional Pension Benefit. Details can be found in the fact sheet Additional Pension.
Q. Will I receive an automatic lump sum if I purchase Additional Pension?
A. No, there is no automatic entitlement to a lump sum but you may convert part of your Additional Pension to a lump sum.
Q. What NPA should I input into the Additional Pension calculator?
A. This could be 60 or 65 depending on when you joined the TPS or if you have a break of 5 years or more, you may wish to refer to Breaks in Pensionable Employment and Future Service and the fact sheet Planning for Retirement.
If your NPA is 60 and you are already aged 60 or over you must select an NPA of 65 for the purposes of the calculation.
Q. If I retire before NPA what happens to my Additional Pension?
A. If you draw your benefits before NPA your Additional Pension will be reduced. If you draw phased retirement benefits, you can choose to draw benefits at first or second phase or on final retirement and the Additional Pension will be reduced in these circumstances as well if retirement is before NPA.
Q. What happens to my Additional Pension if I retire on ill health grounds?
A. If you are granted ill health retirement within one year of commencing payment of Additional Pension, you will receive the return of your Additional Pension contributions. If you are granted ill health retirement more than one year after commencing payment of Additional Pension, you will receive an unreduced Additional Pension.
Q. If I purchase Additional Pension will that cover my dependants too?
A. Unless you specifically purchase dependants’ benefits as well as personal benefits, no Additional Pension will be paid after your death. Dependants include spouse, civil partners and nominated partners. Please note that there are no children’s pensions payable in respect of Additional Pension on death.
Q. Will my additional pension receive increases each year like my scheme pension?
A. Yes, your additional pension will be subject to increases both before and after retirement. The additional pension is index-linked from the date of first contribution and then subject to pensions increase whilst in payment.
Q. What tax relief will I receive on contribution that I pay to purchase an additional pension?
A. Members can obtain tax relief on contributions, including contributions for additional pension up to the value of their salary in the tax year or to the limit of the annual allowance (£225,000 for 2007/2008). A contribution of £3,600 p.a. gross can be paid regardless of earnings.
Those increasing contributions in the 3 tax years either side of retirement should beware of breaching the recycling of retirement lump sum rules.
Nomination of a Spouse or Partner
Q. I am not married and live with my partner. Can I provide benefits for them?
A. Yes, both new entrants and existing members, who are not married or have not entered into a civil partnership agreement, are able to provide dependent benefits for ‘nominated’ heterosexual and same sex partners. There is a qualifying period of two years’ pensionable service from 1 January 2007. If you are an existing member you can buy in pre 1 January 2007 service for a surviving partner benefit at full cost and this will count towards the qualifying period. You must complete a nomination form either on the web or on paper to nominate your partner.
Q. I have already retired and I am living with my partner. Do the surviving partner benefit proposals cover us?
A. Surviving partner benefits only apply to members who were in pensionable service on or after 1 January 2007 and retire after that date.
Q. If I nominate someone to receive a death grant, will they automatically receive a pension too?
A. Death Grant and nominations to receive pension are treated differently and it does not mean that if a death grant nomination is accepted, that person will automatically receive a pension. If you are married, have entered a registered civil partnership or have nominated a partner to receive a pension then a dependant’s pension will be paid however, you can nominate a different person to receive the death grant. If you have nominated a partner to receive a pension after your death there will be a dependency test before any pension can be confirmed.
If this did not answer your query, please check our FAQs index or Contact us.
Back to the topPensions on divorce and pension credit members
Q. I am a pension credit member – when I die will anyone be entitled to continue to receive my pension, if so how much would they receive?
A. No, the pension will cease when you die.
Q. I am in receipt of a pension, my pension share has been processed – when will my pension be reduced?
A. Your current pension will be reduced within 4 months of TP receiving all the information to effect the reduction. If an overpayment of pension arises because of the order it will be recovered from your future pension payments.
Q. I am a pension credit member. If I remarry, will my pension be stopped?
A. No, you will continue to receive your credit member pension.
If this did not answer your query, please check our FAQs index or Contact us.
Back to the topAVCs (Additional Voluntary Contributions)
Q. Will I receive my teachers’ AVC benefits when I receive my TPS pension?
A. Payment of your teachers’ AVC benefits does not have to be linked to payment of your TPS pension. You could access your teachers’ AVC at any time from age 55. If you have a Free Standing AVC arrangement you will need to contact the AVC provider as their rules can vary.
Q. How do I find out what benefits will be due from my AVC?
A. The In House AVC facility is administered by Prudential so you should contact them with any queries regarding the amounts that may become payable. The address for enquiries is:
Teachers' AVC Department
Prudential
Craigforth
Stirling
FK9 4UE
or visit their web site http://www.pru.co.uk/teachers/
Q. Can I use my AVC fund to purchase additional pension?
A. No, it is not possible to purchase additional pension in the TPS with funds accrued under either an AVC, or Free Standing AVC arrangement, or by using a tax-free lump sum from another pension arrangement.
Q. Can I transfer an existing Free Standing AVC into my Teachers' AVC fund?
A. Yes. Free Standing AVC funds can be transferred to the in house AVC facility with Prudential.
If this did not answer your query, please check our FAQs index or Contact us.
Back to the topLeaving the TPS
Q. What happens to my pension when I leave pensionable employment?
A. If you leave pensionable employment there are three options open to you:
Leave your pension credit in the TPS. This is called ‘preservation’. These preserved benefits increase in value each year at a rate equivalent to the Retail Prices Index (RPI). Transfer your pension credit to another form of pension provision. If you have not qualified for benefits you can take a repayment of your pension contributions. When you leave, your employer should issue you with fact sheet, Leaving pensionable employment, which explains these options in more detail.
Q. How do I go about transferring my pension credit to another pension scheme?
A. If you want to transfer your pension rights out of the TPS, TP needs a formal request from your new pension provider. When TP receives the request, a guaranteed statement of entitlement will be issued, normally within three months. Once the signed acceptance and a request for the transfer value is received from your new provider, TP will issue the payment. If you are a pension credit member you cannot transfer out of the TPS.
Q. Why do I only get approximately 55% of my contributions, if I opt for a repayment?
A. The amount you will be repaid will be the contributions you have paid into the TPS together with compound interest added at 3% per annum. Two deductions are made, one to pay back your entitlement in the State Pension Scheme and the other, a standard charge for tax at a flat rate of 20%. For further information, see the Leaving pensionable employment fact sheet
Q. I have an existing Past Added Years (PAY) election, what happens to it if I leave pensionable teaching employment?
A. You have 3 months after your last day of service to clear any outstanding contributions unless you are retiring in which case the outstanding contributions should be paid before you receive your retirement lump sum. Alternatively you can accept a service credit based upon the contributions you have already paid.
Q. I am paying contributions currently under the Current Added Years (CAY) provisions. I am returning to pensionable teaching soon but then expect to leave again in the future. Will I be able to make another CAY election?
A. No, the CAY provisions ceased when the Scheme changes were introduced although existing elections continue to be honoured.
If this did not answer your query, please check our FAQs index or Contact us.
Back to the topRetiring from the scheme
Q. I joined the TPS on 1 January 2007, will I have to work until I am aged 65?
A. No, nobody has to work until 65. If you became a teacher for the first time on or after 1 January 2007, you will have a Normal Pension Age (NPA) of 65. NPA is the age at which you can draw unreduced pension benefits from the TPS. If you were already in teaching before this date, you will retain a NPA of 60. You can retire at, before or after NPA.
Q. I am aged 50 and have only been a teacher for 15 years and do not want to retire at age 60, can I continue to work beyond age 60 and accrue benefits in the scheme?
A. Yes. The scheme rules allow you to work beyond 60 and accrue benefits.
Q. I was a member of the TPS before 1 January 2007 and intend to work beyond age 60 and not draw my pension until I am aged 65. Will my benefits be enhanced?
A. No, actuarial enhancement is only available to those who have a Normal Pension Age (NPA) of 65 and continue in work beyond that age. But your pension would be bigger because you would have more service and further salary increases.
Q. How can I find out the size of my pension fund so I can calculate the amount of tax-free cash I can take when I retire?
A. The actual formula is complex and so a modeller about the tax-free lump sum is available in the Calculators section.
Q. What is phased retirement?
A. You may take phased retirement without having a break in employment provided that your pensionable salary reduces by at least 25% for a minimum of 12 months. This could be because you have taken up a post of lesser responsibility or because you are working less hours. You can decide how much you wish to take of the benefits you have accrued up to the start of your phased retirement, subject to a maximum of 75% of your total benefits. Your remaining service will be aggregated with the subsequent service you accrue. For further information see the Retirement – arrangements and planning leaflet. To obtain an online estimate of benefits please use the ARB / Premature Retirement Calculator and refer to point 5 of the notes on the calculator regarding phased retirement.
For further information see also the Phased Retirement FAQs section.
Q. When do I apply for retirement benefits?
A. You should apply using the relevant form about four months before the date you wish to draw your pension. Which form you use depends on your circumstances when you retire. For further information, see the Retirement – arrangements and planning leaflet. Remember – it is your responsibility to make this application
Q. I have sent my retirement application in late/just prior to my 60 th birthday – when will my benefits be paid?
A. TP will make best endeavours to ensure that you application is processed within 20 working days of the receipt of your application form if this is received either just before or after your 60 th birthday.
Q. I have received information from you stating that my benefits will be paid on the due date – when is this?
A. The due date is either the day after your last day of service or your NPA which ever is the later date. If you are retiring on the grounds of phased retirement your due date is normally the first day you are employed on a lower salary. If you are out of pensionable service and are taking Actuarially Reduced retirement your due date will be the date of your choice but this cannot be earlier than age 55 or 6 weeks from the date you signed the application. Where your application is received after or close to the due date TP will make best endeavours to ensure that you application is processed within 20 working days of the receipt of your application form.
Back to the topConverting Pension to a Tax Free Lump Sum
Q. What is commutation?
A. Commutation is converting part of your annual pension into a lump sum. Your pension will be reduced accordingly for your lifetime. This does not impact your beneficiary’s long term pension.
Q. Can I change my mind about the option to convert pension to lump sum?
This depends on whether you are in receipt of your pension and lump sum or not.
Once you are in receipt of the pension and retirement lump sum you have elected to receive, the application will stand.
If your pension and lump sum have not yet come into payment, you may revoke the election to convert part of your pension into lump sum. This must be done in writing and this may give rise to a delay in putting the revised benefits into payment.
It is important that you make the right decision first time.
Q. How do I calculate the effect of converting my pension to lump sum?
A. There is a calculator available on the TP website. Please refer to the Pension and Lump Sum ready reckoner.
Q. What is the long term effect upon my pension if I decide to convert part of my pension?
A. Your pension will be reduced for the rest of your life.
Q. I am already entitled to an automatic lump sum. Can I still convert some of my pension?
A. Yes, provided you have service after 1 January 2007. You can use the calculator Pension and Lump Sum ready reckoner to determine how much you can convert and the effect it will have on your pension.
If this did not answer your query, please check our FAQs index or Contact us.
Back to the topPension benefits
Q. How are my pension benefits calculated?
A. Please refer to Your Pension Benefits for details of how benefits are calculated.
Q. Can I find out what my benefits will be on various retirement dates?
A. The TPS calculates retirement benefits using members’ average salary and service. ‘Real time’ estimates of your benefits can be obtained from the website provided you meet the terms and conditions shown on the "Registration" screen. TP is unable to provide estimates of benefits that may become payable at a future date. You may however, use a calculator on the TP website to make your own projections. If you are in service, you will automatically receive an estimate each year. For further information about average salary, see the Average salary fact sheet.
Q. Will I receive a lump sum when I retire?
A. Yes, if you were a TPS member prior to 1 January 2007 you will receive a lump sum of 3/80th of the average salary for each year of pensionable service. If you have pensionable service on or after 1 January 2007 you may increase this lump sum and for each £1 of pension converted this will increase your lump sum by £12. If you joined the TPS after 1 January 2007 there is no automatic lump sum, however, to get a lump sum you can convert £1 of pension for £12 of lump sum. You can convert up to 25% of your total pension benefits. For further information, please refer to this article, or you can use our calculators to see the effect on your pension.
Q. Are the benefits from the TPS index linked?
A. Yes, for both members who were in the TPS before 1 January 2007 and those who joined after that date.
Q. I have recently lost my management allowances and I will retire in a few years time. How will this affect my pension?
A. The calculation of pension benefits is based on the better of the salary in the last year or the average of the best three consecutive years (re-valued in line with the Retail Prices Index (RPI)) in the last ten years. This means that management allowances can still be picked up for your pension calculation if that produces a higher pension than using your actual salary at retirement. For further information about average salary, see the Average salary fact sheet.
If this did not answer your query, please check our FAQs index or Contact us.
Back to the topIll Health retirement
Q. Does the TPS provide ill-health retirement benefits?
A. If, before you reach Normal Pension Age (NPA) you have become permanently unfit because of illness to serve as a teacher, ill-health benefits may be paid. Ill-health benefits are paid at two different levels depending upon the severity of your illness. Total Incapacity Benefit (TIB) is awarded if you are assessed as being permanently unable to teach and unable to undertake any other gainful employment. Partial Incapacity Benefit (PIB) is awarded if you are assessed as being permanently unable to teach but able to do other work. For further information see the Ill-health retirement benefits leaflet.
If this did not answer your query, please check our FAQs index or Contact us.
Back to the topWorking after retirement
Q. Can I continue to work after receiving retirement benefits?
A. If you are 55 or over you may take phased retirement without having a break in employment provided that your pensionable salary will reduce by at least 25% for a minimum of 12 months. If you retire on phased or actuarially reduced benefits you will continue to accrue further pension benefits and your pension will not be affected. If you retire on ill health grounds your pension will stop as soon as you start work. If you retire on age or premature grounds you will continue to accrue further pension benefits but your current pension may be reduced whilst you are working. For further information see the Retirement – arrangements and planning leaflet.
If this did not answer your query, please check our FAQs index or Contact us.
Back to the topPhased retirement
Q. What salary reduction is required for phased retirement?
A. Your new salary must reduce by 25% compared to your pre-reduction salary, averaged over the six months prior to the reduction.
Q. Do I need to discuss phased retirement with my employer?
A. Yes, you must first discuss the reduction in either hours or responsibility with your employer as they need to certify that there is a lower paid post for you to take up which will qualify you for phased retirement. Your employer will also need to certify your phased retirement application form.
Q. What if my employer cannot accommodate my request for phased retirement?
If this is the case, you would need to seek employment in another participating employer in the Teachers' Pension Scheme to meet the criteria. It would be up to your new employer to certify that the necessary reduction has occurred.
Q. What is the maximum percentage that I can draw on phased retirement?
A. The maximum is 75% of the benefits you have accrued in the Scheme, less any benefits you have already drawn from phased retirement.
Q. What happens if my salary breaches the 25% reduction in the first 12 months after your phased retirement?
A. Your application will be void and your benefits will be suspended. There may also be an unauthorised payment charge from HMRC of 40% of the lump sum you have received.
Q. What death benefits are paid whilst drawing phased retirement benefits?
A. If you are in pensionable employment, you will receive 3 times your average salary less any lump sum paid at retirement. If you are out of service but drawing phased retirement benefits and you die within 5 years of drawing phased retirement benefits, you will receive the balance of the 5 years as a lump sum. The unclaimed portion of your pension will be paid as an out of service lump sum, equal to the retirement lump sum you would have received.
If this did not answer your query, please check our FAQs index or Contact us.
Back to the topMaternity Absence
Q. What happens to my service when I go on maternity leave?
A. If you receive pay or Statutory Maternity Pay (SMP) then that period of maternity leave will be classed as pensionable employment. Where you do not receive any pay or SMP that period will not be counted as pensionable.
Q. What happens if decide not to return to service after my maternity leave?
A. Your pensionable service will be considered to have ceased at the end of your paid maternity leave. More information can be found in the fact sheet Maternity/Paternity.
Back to the topMy Pension Online
Q. I am having trouble logging in to the online service. I have registered previously but have lost/forgotten my details.
A. Please try using the Remind Me facility. You only need to enter at least one of your username, password or PIN, and following this you will need to confirm some identifying details. If this does not work, you may have locked your account. Please email us at tpwebadmin@capita.co.uk quoting your full name and reference number. We can then provide you with further assistance.
Q. I am having trouble registering for the online service.
A. Please read the registration guidance notes as they provide assistance to members trying to register. If you still have problems after consulting the guidance notes, please email us at tpwebadmin@capita.co.uk quoting your full name and reference number. We can then provide you with further assistance.
Q. I have registered successfully for the online service but have not received my PIN.
A. Please email tpwebadmin@capita.co.uk quoting your full name and reference number, together with the answer to your personal question, and we will provide a PIN.
Q. If I register to your secure website what details can I access?
A. Our secure website enables scheme members to access a personalised estimate of retirement benefits (subject to having completed sufficient service to qualify for the payment of retirement benefits) based on the latest service and salary details that have been sent to Teachers’ Pensions by your employer. Additionally you can securely submit changes to your personal details (such as name and address), update your death grant nominees, or submit an election to opt out of the scheme (if you wish to stop contributing to the scheme so that your future teaching employment will be treated as non-pensionable).