Pensioners' FAQs
Frequently Asked Questions (last updated May 2008)
Deductions, tax and Lifetime Allowance Annual information and Pensions Increase Death benefits Re-employment Pension share and pension credit members My Pension OnlineDeductions, tax and Lifetime Allowance
Q. Why has my pension been reduced upon reaching state retirement age?
A. The Teachers’ Pensions Regulations provide that retirement benefits are based on total reckonable service and average salary less any deductions in respect of the flat- rate national insurance scheme and the graduated pension scheme.
Flat-rate National Insurance Contributions
If you started pensionable teaching employment after June 1948, your pension contributions were lower because of National Insurance legislation until 31 March 1980. The basic rate of pension is accordingly reduced by £1.70 per annum for each year of service between these dates.
Graduated National Insurance Contributions
The Teachers’ Pension Scheme was contracted out of the National Insurance Graduated Pension Scheme. If you contributed to that scheme between 3 April 1961 and 5 April 1975, your teacher’s pension will be reduced to take account of the extra state pension you will receive.
The state pension is made up of:
- the basic state pension and;
- an additional pension from SERPS.
(The amount received depends on the level of your salary)
For a full explanation of SERPS please refer to The Pensions Service website. For more information on your state pension contact The Pensions Service at:
The Pensions Service
Tyne View Park
Newcastle upon Tyne
NE98 1BA
Q. Why has my tax code changed?
A. We are instructed by Inland Revenue to apply relevant tax codes. For further information and questions about your income tax assessment, please contact:
HM Inspector of Taxes
South Wales Area (MU2)
Ty Glas
CARDIFF
CF14 5YA
www.hmrc.gov.uk
Q. How is my pension affected by the new Lifetime Allowance from 6 April 2006?
A. The Lifetime Allowance came into effect on 6 April 2006 and is set at £1.5 million for the tax year 2006/2007, increasing to £1.6 million for tax year 2007/2008. The Lifetime Allowance is the cumulative value of benefits that can be taken from all registered pension schemes before an additional tax charge is payable. This tax charge is called the Lifetime Allowance charge.
The important point to note is that existing pensions will not be affected by the Lifetime Allowance charge. Neither will state pensions or dependant's pensions which, themselves are not assessed against the Lifetime Allowance.
The only way in which the Lifetime Allowance charge could affect you is if you become entitled to a new pension after 5 April 2006. Existing pensions will be taken into account in assessing any new pension that may put your cumulative value above the Lifetime Allowance. Please note that all existing pensions (excluding state and dependant's pensions) and any new pension coming into payment would need to exceed at least £60,000 per annum to be affected.
If all your existing pensions and any other pensions you may have which have not yet come into payment exceed £60,000 per annum, you may qualify for protection from the Lifetime Allowance charge from HM Revenue and Customs. Details of the protections available are available on the HMRC website www.hmrc.gov.uk/pensionschemes. If you are likely to be affected, we strongly recommend that you take independent financial advice.
Annual information and Pensions Increase
Q. Who decides on the pensions increase each year & when is it done?
A. The Secretary of State for Social Security makes the announcement in a draft Pensions Increase (Review) Order which is approved by Parliament usually during March each year. The new rate of increase takes effect from the first Monday after 5 April each year.
Q. What is this year’s pensions increase?
A. The rate of increase from 7 April 2008 is 3.9%. In common with other public service pensions, teachers’ pensions are increased annually each April in line with the retail prices index for September of the previous year, so as to maintain their purchasing power. The rate of increase will not, therefore, necessarily mirror any rate of increase of teachers’ pay; it might be higher or lower. For pensions payable before 55, this increase will not be payable until the 55th birthday, unless teacher retired on ill-health grounds or has a dependent child.
For previous years the rates have been as follows: -
9 April 2007 |
3.6% |
10 April 2006 |
2.7% |
11 April 2005 |
3.1% |
12 April 2004 |
2.8% |
7 April 2003 |
1.7% |
8 April 2002 |
1.7% |
9 April 2001 |
3.3% |
10 April 2000 |
1.1% |
12 April 1999 |
3.2% |
6 April 1998 |
3.6% |
7 April 1997 |
2.1% |
Q. If this years PI is 3.6%, why has my gross monthly amount not increased by 3.6%?
A. PI is applied from 9 April 2007, so unless the first payment date after the new PI figure is applied is on 8 May 2007, the first month's increase will never exactly match the annual increase.
Q. Why did I not receive the full increase to my pension?
A. The increase you receive depends on the date on which your pension began. You may receive a lower percentage if your pension started on or after 25 April 2006. If you have reached State Pension Age, the increase to your pension is calculated differently due to the Guaranteed Minimum Pension (GMP) rules. Some of the increase on the GMP part of your pension may be paid by the Government with your State pension. Further information can be found in the TP Pensioner Newsletter.
Q. My pension rate was £10,000 last year, why is this amount not shown on my P60?
A. The annual rate of pension nearly always differs from the amount shown on your P60. This is because the annual rate is effective from the day before your birth date whereas the P60 covers pension payments made in the previous tax year, ie 6 April to 5 April.
Back to the topDeath benefits
Q. Will benefits will be paid to my dependants after I die?
A. The table below sets out the benefits payable depending upon your individual circumstances.
| Widows | Widowers | Civil Partners | Nominated Partners |
|---|---|---|---|
|
All service from 1.4.72 counts for family pensions
|
All service from 6.4.88 counts for family pensions
|
All service from 6.4.88 counts for family pensions
|
All service from 1.1.07 counts for family pensions. Nominations must be signed by member and partner. Dependency checks are made after the member dies. |
Q. If I remarry, enter into a civil partnership or nominate a partner after I retire, will a pension be paid to my dependants after I die?
A. The table below sets out the benefits payable depending upon your individual circumstances.
| Widows | Widowers | Civil Partners | Nominated Partners |
|---|---|---|---|
|
If a member marries or remarries after leaving pensionable employment only service from 6.4.78 counts towards the pension.
|
If a member marries after leaving pensionable employment, only service from 6.4.88 counts towards the pension, regardless of whether pre 88 service has been purchased.
|
If a member registers a civil partnership after leaving pensionable employment, only service from 6.4.88 counts towards the pension, regardless of whether pre 88 service has been purchased. |
Members who left pensionable employment before 1.1.07 cannot nominate a partner unless they come back into pensionable teaching employment. Members cannot cover previous service after retiring unless they come back into pensionable teaching employment.
|
Q. I am not married and live with my partner. Can I provide benefits for them?
A. Yes, 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 a current 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 benefits cover us?
A. Yes. Pensioners can nominate a partner but only service from 1 January 2007 counts for benefit, a 2-year qualification period is required and they can only purchase previous service if they are in pensionable employment.
Q. How should a bereavement form be completed when there are no beneficiaries?
A. The pack contains information and application forms which we hope will be helpful in understanding the benefits payable from the Teachers’ Pension Scheme. Part A of the application form Death Benefits should be completed in all cases and returned to Teachers’ Pensions as soon as possible enclosing all relevant certificates and documentation. This will enable us to calculate and pay any benefits without delay. If there are no beneficiaries, Part A should still be completed, normally by the personal representative and returned to Teachers’ Pensions. The Survivor and Death Benefits leaflet provides details of who the benefits may become payable to.
Q. My late husband/wife said that my widow/ers pension would be half of his/her pension. Why is my pension less than half?
A. The widow/ers pension is half of the pension if all of the member’s reckonable service counts for family benefits. If all of the service was not covered then the pension will be a smaller proportion of the member’s pension based on the number of years counting towards family benefits. For details on the amounts of service which may count for family benefits service see leaflet Survivor and Death Benefits.
Q. How long will an adult dependant’s pension be paid?
A. If the member had pensionable service on or after 1 January 2007 then the adult dependant’s pension will be paid for life. If the member had no pensionable service after 1 January 2007, the pension will cease if the adult dependant remarries, enters a civil partnership or cohabits. The dependant’s pension will always cease when the dependant dies.
Q. At what age will a child’s pension cease?
A. The rules on the continuation of a child’s pension differ slightly depending on whether the member was in receipt of a pension before 6 April 2006 or not.
If the member was receiving a pension prior to 6 April 2006, the child’s pension will continue until the age of 17 or the child ceases full time education. If the member’s pension came into payment after 5 April 2006, the child will continue to receive a pension until age 17 unless they continue in full time education up to a maximum age of 23. In all cases if the child marries, takes up employment or dies, the pension will cease.
Back to the topRe-employment
Q. Can I continue to work after receiving retirement benefits?
A. If you retired on phased or actuarially reduced benefits you will continue to accrue further pension benefits and your pension will not be affected. If you retired on ill health grounds your pension will stop as soon as you start work. If you retired 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.
Q. How does part-time work affect my pension benefits?
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. It may be possible for you to submit an election to opt out of the scheme via My Pension Online (our secure website). 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. I am a pensioner and will be opting out when entering further employment. Will my pension be affected?
A. Depending upon the level of your future earnings your pension may be affected. Opting out of the TPS will not affect your existing entitlement but your earnings will still be taken into account for abatement purposes.
Back to the topPension share and pension credit members
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 - 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 a pension credit member - if I remarry, will my pension be stopped?
A. No, you will continue to receive your credit member pension.
Back to the topQ. Why have you omitted the last letter from my National Insurance number?
A. The letter is no longer in use by the Inland Revenue and is not necessary for identification purposes.
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 historical record of their monthly pensioner payslips and annual P60s. Additionally you can securely submit changes to your personal details (such as name and address), and if you return to teaching but do not want to contribute to the scheme it may be possible for you to complete and submit an election to opt out of the scheme.
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