Definitions you might find useful.
Last Updated: 25/06/2021 13:42


Actuarially Adjusted Benefits - see Early Retirement, Premature Retirement and Phased Retirement.


Abatement is the possible temporary reduction in pension during a period of Additional Service After Retirement.

Accrual rate

The rate at which your pension builds up, based on your pensionable earnings (career average standard rate of 1/57th of pensionable earnings) or pensionable service (final salary 1/80th or 1/60th depending on when you joined and any service breaks you've had).

Active Teacher

An active teacher is a teacher who is currently in teaching employment and is actively contributing to the Scheme.

Actuarial Reduction

The percentage reduction that an Early Retirement (Actuarily Adjusted Benefits), Premature Retirement or Phased Retirement pension is subject to, depending on the age at which a member takes their benefits.

Actuarially Adjusted Benefits (AAB)

Pensions can be taken from the age of 55 (or earlier if due to ill-health). Where a pension is being paid out before the Normal Pension Age (NPA) for those benefits the amount is reduced using actuarial factors because it is being paid out for a longer period than if taken at NPA.

Additional Pension

An option available to members in the final salary and career average arrangements to increase their pension. Additional Pension can be purchased in multiples of £250 and can be paid for through monthly contributions deducted directly from salary over a set period of time, or by a one-off lump sum.

Additional Service After Retirement (ASAR)

This is when a member returns to teaching after claiming retirement benefits from The Teachers’ Pension Scheme (doesn't apply to continued service during Phased retirement).

Additional Voluntary Contribution (AVC)

The Teachers' Additional Voluntary Contribution (TAVC) scheme is operated separately from the Teachers' Pensions Scheme and is adminstered by Prudential. The TAVC is a defined contribution money-purchase scheme and the pension benefits are dependant on the amount of money paid in and investment returns.

Age Retirement

Taking retirement benefits at a member's Normal Pension Age (NPA) for the particular arrangement, e.g. NPA60 and NPA65 final salary arrangements, or NPA equal to state pension age (or 65, whichever is highest) in the career average arrangement.

Annual Allowance

Annual allowance refers to the amount by which a member's pension can grow within a pension input period (PIP). The PIP has to be aligned with the tax year. If the pension growth in a PIP is greater than the Annual Allowance, a member will be subject to a tax charge on the excess.

Annual Return

The file used by employers to provide Teachers' Pensions with information relating to service and salary of their employees. The annual return spans 1 April (Year 1) to 5 April (Year 2), in line with the pension input period (PIP) for Annual Allowance calculations

Annuity values

If you come back into pensionable service after retirement, but don’t complete the minimum period of service (12 months) in order to qualify for a further pension, you’ll be paid an annuity rather than receive a refund of your contributions. The annuity is based on the actuarial value of the contributions and is paid in addition to your main pension.


Auto Enrolment

Employees who're eligible for the Teachers' Pension Scheme will be contractually enrolled into the Scheme when they start their job. They can choose to opt-out at any point. However, under Auto Enrolment legislation an employer has to assess their employees every three years and if they're not an active member auto-enrol them into a suitable pension scheme.

Average Salary

The salary used to calculate a final salary pension. This is calculated on the most beneficial of the following; either the last 365 days salary or the best 3 years’ salary over the previous 10 years (revalued where there has been a change in salary in the 3 year period). If a member has undertaken part-time employment, their full-time equivalent salary will be used in the calculation, but the pensionable service will be based on the part-time hours.

Average Salary Service

Pensionable service accrued while a member is in the final salary scheme arrangement.


The pension that a member is awarded.



The person(s) entitled to benefits in the event of a Scheme member's death.

Benefit Statement

An estimate of current pension benefits based on the service and salary details provided by employers. The information held on the benefit statement can only be as accurate as the information provided by employers, which is why it should always be checked to see if the service and salary details we hold are accurate.

Buy out

In the Career Average arrangement, the Normal Pension Age (NPA) is either a member's State Pension Age or 65, whichever is the higher.  Members can buy out up to three years of the standard rate of actuarial adjustment between years 65 and 68 (or less if their NPA is lower).


Career Average

From 1 April 2015 the method of benefit accrual for new entrants or transitioning members became Career Average Revalued Earnings. This is a defined benefit pension where a fraction of pensionable earnings are banked each year and revalued annually on a compound basis.

Cash Equivalent Transfer Value (CETV)

A document that specifies the value of a pension as a cash transfer amount. It's necessary for both transfering out of the Teachers' Pension Scheme and for pension on divorce proceedings. The cash equivalent is the value of the pension fund.

Certificate of re-employment

A form that must be completed at the start of the Scheme year by those members who have retired on Age or Premature grounds and then subsequently re-entered eligible teaching employment, so that an assessment for abatement can be made (and overpayments of pension avoided).

Child Pension

The annual pension due to the child(ren) of a member in the event of the member's death. For children to be eligible to receive this pension they must be under 17 or in full-time education (with no gap years) and under 23.

Club Transfers

These are transfers between pension schemes for members of the public sector transfer arrangements.   Schemes include Teachers, Local Government, Civil Service, NHS, Police, Firefighters, Army and Judiciary.


Allows a member to give up a portion of their pension and convert it to a tax-free lump sum (subject to maximum limit of 25% of the value of the pension fund).

Concurrent Service

Where the employee holds more than one contract with the same employer.

Consumer Price Index

This is the official method of calculating inflation in the UK. It's a measure of the cost of living and reflects changes in the general price level.

Contributions Monthly Breakdown

The form used by employers to provide a breakdown of the contributions they have paid on behalf of the active scheme members in their employment. The breakdown splits out contributions in each payband tier and for extra pension flexibilities.


Allows a member to give up a portion of their pension and convert it to a tax-free lump sum (subject to maximum limit of 25% of the value of the pension fund).


Comma Seperated Value (CSV). When completing our templates we often ask if they can be returned in CSV format, specifically CSV (Comma delimited). This option can be found when using the "Save as" feature in Microsoft Excel.


Death in Service

The term given when a member passes away while in active service, i.e. in a pensionable teaching employment contract or within 12 months of leaving due to their ill health.

Deferred Member

A member of the Teachers' Pension Scheme who is not in active service, i.e. they are not in pensionable taching employment as a result of either leaving such employment or having opted-out of the scheme.

Department for Education

The Department for Education is responsible for education and children’s services in England. In the guise of the Secretary of State, it is the scheme manager of the Teachers' Pension Scheme.

Department for Work and Pensions

The Department for Work and Pensions (DWP) is responsible for welfare, pensions and child maintenance policy.

Dependant's benefits

The benefits paid to the dependents of a deceased member,  generally a spouse or nominated partner and children.

Disqualifying break

If a member returns to active service after a break of not more than 5 years, they will retain any transitional protections or active status on previously accrued benefits. If the break is more than 5 years, then this is treated as a disqualifying break.


Earnings limit

Your earnings limit is the amount you can earn each year in teaching employment, following retirement, before your pension becomes subject to abatement. The earnings limit is also referred to as a ‘Salary of Reference’, which can be found on the award papers you received when you retired. The earnings limit is the revalued ‘salary of reference’. The earnings limit and abatement of pension only applies with respect to final salary pensions that you take on or after the normal pension age for those benefits (either 60 or 65), but any teacher’s pension your receive, including career average pension, is taken into account when assessing if you have reached your earnings limit.


Eligible child

In respect of family benefits, a child, adopted child or child who was accepted as part of the member's family and wholly or partially dependent upon the member prior to the member's death, who is under the age of 17, or, if they have been in continuous full-time education or training, under the age of 23.

Eligible jobholder

Under Auto-Enrolment legislation, employers must enrol eligible jobholders into a suitable pension scheme. The criteria for eligiblity under auto-enrolment are different than for contractual enrolment into the Teachers' Pension Scheme.

Employer Portal

The Employer Portal is the system used for securely exchanging data about pension scheme members between Teachers’ Pensions and data holders (e.g. employers, payroll/HR providers). It also provides the facility for online applications from members to be administered.

Employer’s Contracting Out Number (ECON)

The Teachers' Pensions ECON is: E3900002R.

Enhanced benefits

Pension benefits may be enhanced if a member retires after their normal pension age to reflect the fact that the benefits will be paid for a shorter period of time.

Enhanced pension

Members who retire on the grounds of ill-health and receive a total incapacity pension will have their accrued pension benefits enhanced to take account of the nominal pension accrual between the date of the ill-health retirement and the normal pension age for those benefits.

Excluded Employment

Employment which would be pensionable except the member has opted out of the Teachers’ Pension Scheme. Alternatively, the member has not made an election for part-time service or post retirement service to be treated as pensionable.


Family benefits

Short-term and long-term pension payable to the spouse or nominated partner of a deceased member, and/or to children of a deceased member.

Faster accrual

An flexibility option available to members in the career average arrangement to increase their pension through adding a larger fraction of their pensionable earnings to it. Each election lasts for one year (April - March) and must be made before the start of the Scheme year (April).

Final Average Salary

The salary used to calculate a member’s final salary pension benefits based on the most beneficial of the following; either the last 365 days salary or the best 3 years’ salary over the previous 10 years plus any applicable inflation. If a member has part-time employment, their full time equivalent salary will always be used in the calculation.

Final Salary Scheme

The final salary arrangement is split into two categories:

Those who joined the scheme prior to the 01/01/2007 entered the 80th section with a Normal Pension Age (NPA) of 60

Those who joined the Scheme on or after the 01/01/2007 entered the 60th section with a NPA of 65. From 01/04/2015 new entrants join the career average arrangement.

Financially Dependent

A financial dependant is anyone who relies financially on a Scheme member for things such as money, clothes or food. This might include children, spouses, nominated partners or relatives.

Financially Interdependent

Co-habiting partners who share household bills.


Refer to the ways in which a member can accrue extra pension in the Scheme: Additional Pension; Faster Accrual; and the Buy-out of the standard rate of actuarial reduction. The latter two options are only available in the career average arrangement.


Guaranteed Minimum Pension (GMP)

This is the minimum pension any scheme must provide as a condition of being contracted out of the state additional pension scheme.


Her Majesty’s Revenue and Customs (HMRC)

HMRC is the former name of the Inland Revenue.

HM Treasury

HM Treasury is the government’s economic and finance ministry, maintaining control over public spending and setting the direction of the UK’s economic policy.


Ill-Health Retirement

Ill-health retirement allows members who are too ill to teach to access their pension benefits before the minimum pension age of 55. An application is made to Teachers’ Pensions accompanied by medical evidence and a board of medical advisors assess the application

In service

A member who is actively contributing to the Scheme through their appropriate employment.


Being index-linked protects your pension against rises in inflation, which means your pension may increase but will never decrease.

Indexed Amount

The amount of a benefit or salary after it has been revalued in accordance with an index.  For example, in the career average arrangement benefits are revalued in line with CPI + 1.6% for active members, or by the Pensions Increase (Review) Order for deferred members.

Irregular part-time

A part-time teacher without fixed, regular hours in each pay period or a short-term fixed hours contract.


LA/Establishment Number

This is the unique employer identifier, eg 123/1234.

Lifetime allowance (LTA)

The Lifetime Allowance or LTA is the amount of pension benefits that can be taken before a tax charge is payable at the point the pension benefits come into payment

Local Government Association (LGA)

The LGA are a politically-led, cross-party organisation that works on behalf of councils to ensure local government has a strong, credible voice with national government.

Long Term Pension

The annual pension due to the spouse/civil partner and/or child(ren) following the death of a member. Where the member was active in the scheme up until their death the long-term pension is paid after the short-term pension ceases.


Mandatory compensation

The compensation that increases a member’s pension when they have been offered Premature Retirement. This refers to the annual pension and any applicable lump sum.

Maternity leave

While on maternity leave, contributions from the member and employer are still paid into the Scheme and service will be classed as continuous. If the member ceases to be paid (either salary and/ or statutory pay), no contributions are made and the period without pay is non-pensionable.

Mixed Service

If you have service in the scheme before 1 January 2007 and have taken a break of more than five years before returning to pensionable service. Mixed service means you have a Normal Pension Age of 60 for service before 1 January 2007 and an NPA of 65 for service after this date.

Monthly Data Collection

Monthly Data Collection or MDC provides employers with the means to submit service and salary information on their employees on a monthly basis rather than via the Annual Service Return.

Multiple Employment

Multiple employment is where a member is in part-time pensionable employment concurrently with more than one Teachers’ Pension Scheme employer. In the career average arrangement members can be in concurrent employments that, combined, are more than a full-time position.

My Pension Online

My Pension Online (MPO) is our online personalised PIN protected portal for members. It gives instant access to the latest view of members Benefit Statements, the ability to update details and provides access to a range of forms and resources.




A member can nominate one of more people to receive a death grant in the event of their death. If a member is married or in a civil partnership, the death grant is automatically paid to them and a nomination is not necessary.

Normal Pension Age (NPA)

The age at which you're eligible to claim retirement benefits without actuarial reduction.


Opting in

A member can opt back into the Scheme after opting-out by completing the ‘Election to join the Teachers' Pension Scheme’ form. Once complete, contributions are taken from the first day of the following month that the form is received.

Opting out

Opting-out allows a member to elect to cease paying contributions to the Teachers' Pension Scheme. This also includes any employer contributions. Any pension previously accrued will be deferred until a member chooses to opt-in again or take their benefits (if applicable).


If an employer pays overtime and the member is in the career average arrangement, the overtime is classed as pensionable earnings.


Part Time

Members who are not full-time employees are classed as part-time.  This can either be regular or irregular part-time depending on the nature of the contract with their employer.

Past Added Years

Allows members to increase the pension they receive at retirement by increasing their pensionable service. It's no longer available having been replaced by Additional Pension from 1 January 2007. Existing elections through instalments can continue to be paid until the end of agreed contribution period.

Paternity leave

While on paternity leave, contributions from the member and employer are still paid into the Scheme and service will be classed as continuous. If the member ceases to be paid (either salary and/ or statutory pay), no contributions are made and the period without pay is non-pensionable.

Payable Date

The date that the first pension payment is paid. This can vary depending on service and circumstances.

Pension Credit Member

A pension credit member is a member of the Scheme having been granted a proportion of a member’s pension through a 'Pension on Divorce' or 'Pension Sharing Order'. A pension credit member may also be a member of the Scheme in their own right.

Pension scheme registry number

The Teachers' Pension Scheme registry number is 10005209 (2010 scheme and earlier) and 10276733 (2015 scheme).

Pension Transfers

Pension schemes often provide members who move jobs or change professions with a time limited opportunity to transfer benefits out of the scheme (in the case of leavers), or into the scheme (in the case of joiners).

Pensionable Employment

This is any period of full or part-time employment between the ages of 18 and 75, where a member is entitled to receive not less than half their salary or, in the case of family leave, statutory pay, and on which pension contributions were paid. This includes sickness absence.

Pensionable Salary

Pensionable salary is your contributable salary (the salary on which you pay pension contributions).

Pensionable Service

Service that is active and on which pension contributions are paid.


A pensioner in the Teachers' Pension Scheme is one who is in receipt of their pension directly from the Scheme.

Pensions Advisory Service

An independent and free service offering impartial advice and assistance for members who have queries or complaints about their pension scheme / pension scheme administrator.

Phased Retirement

You have the option to access your pension benefits from age 55 without having to give up work completely.

Phased retirement allows you to decide how much you wish to take of the benefits you have accrued - up to a maximum of 75% of your total benefits.

Premature Retirement

If a member is made redundant from the age of 55, but before they reach their normal pension age, they can take their pension without any reduction if the employer offers to compensate for the difference. Premature retirement is always at the discretion of the employer.

Preserved Benefits

These benefits are paid to the member when they reach their Normal Pension Age if they’ve left the Scheme and haven’t transferred their entitlement to another pension scheme.

Protected Member

A member of the Scheme who originally joined in the final salary arrangement and who was within 10 years of their normal pension age on the 1st April 2012. They’ll remain in the final salary scheme until retirement.


Prudential administer the Teachers' Additional Voluntary Contributions scheme.

Public service transfer club

These are transfers between pension schemes for members of the public sector transfer arrangements. Schemes include Teachers, Local Government, Civil Service, NHS, Police, Firefighters, Army and Judiciary.


Qualifying service

The period of active membership of the Scheme required in order to qualify for pension benefits. The qualifying period is 2 years, or one year for additional service after retirement and includes service that runs across both the final salary and career average arrangements.



Teaching employment undertaken after a member has accessed their pension benefits in full (i.e. not phased retirement).

Re-payment of contributions

Members who do not have qualifying service can take a repayment of their contributions from the Scheme. To take a repayment, they need to be either opted-out if they’re still in a role that is eligible in the Scheme or be in a role that isn't eligible.

Reckonable Service

Reckonable Service is any service that counts for benefits in the final salary arrangement. It can include service from pensionable employment, any additional service previously purchased, and any service credited into Teachers’ Pensions from another pension scheme.

Residential emoluments

Where a teacher is provided with accommodation and associated services as part of their contract of employment, the value of this can be treated as part of their pensionable earnings.

Restricted salaries

Where a teacher's salary increases by more than 10% or a fixed amount, the increase for the purpose of determining final average salary is restricted to whichever increase (10% or fixed amount) is highest.


Salary link

Members who transitioned from final salary to career average on or after 1 April 2015 have salary link protection, which provides for the salary earned under the career average arrangement to be used when calculating the final average salary for final salary arrangement pension benefits.

Salary sacrifice

Under the Teachers' Pension Scheme the only salary sacrifice arrangements that are pensionable are for childcare vouchers and mobile phones .

Scheme Contracted Out Number (SCON)

The Teachers' Pensions SCON is: S2730011H

Secure Transfer Utility (STU)

Previous name given to the Employer Portal.

Short service pension

Where a member does not qualify for a further pension following a period of additional service after retirement, a short service pension or annuity is provided based on pension contributions and actuarial factors.

Short Service Serious ill-health grant

If a member who has not qualified for pension benefits but with more than 12 months qualifying service leaves their job due to serious ill-health they are entitled to a grant based on the higher of 1/6th of their annual rate of pensionable earnings or their contribtions.

Short-term pension

The pension paid for 3 months following the death of an active member. It is equivalent to the full-time rate of pensionable earnings the member would have received during the period.

State Earnings Related Pension Scheme (SERPS)

SERPS and State Second Pension (S2P) was also known as the Additional State Pension. SERPS ran from 6 April 1978 to 5 April 2002 when it was replaced by the S2P.

State Pension age

The age at which you're elegible to receive your State Pension.

Supplementary death grant

When a member passes away within 5 years of taking their pension, a supplementary death grant will be paid to their beneficiary. This death grant will be calculated by using 5 times the member’s annual pension, minus what they have already received.


Any surviving eligible beneficiaries at the point that a member passes away.

Survivor's benefits

The funds available to an elegible surviving beneficiary when a member passes away.


Tapered Member

A member who joined prior to 1 April 2015 and who, due to being more than 10 years but less than 13.5 years away from their normal pension age on the 1 April 2012, will transition to the career average arrangement after the 1 April 2015 following a period of tapered protection.

The Regulations

These are the Teachers’ Pension Regulations 2010 (Statutory Instrument 2010 No.990) and the Teachers Pensions' Regulations 2014 (Statutory Instrument 2014 No.512).

Total Incapacity Benefits

The award given to a member who has successfully applied for ill-health retirement and who is deemed no longer fit to work in a teaching role or any other type of gainful employment.

TPS Pension Board

The TPS Pension Board (TPSPB) was established to give Scheme members, tax payers and others confidence that the scheme is being efficiently and effectively administered. It has a role in ensuring that the services provided reflect the needs of the membership and employers.

Transfer of Undertakings

Transfer of Undertakings (often referred to as TUPE) is where a body becomes a person’s employer through an enactment regarding the transfer of staff.

Transition Member

A member who was previously in either the 80th or 60th arrangements who transitioned into the career average arrangement on or after 1 April 2015.

Treasury Order

An order made by HM Treasury laid in Parliament. This is used in the active revaluation of career average pension and is expected to mirror the CPI rate from the previous September.