Posted September 26th, 2011
If you are considering fixed protection then time is ticking – From April 06 2012 the Lifetime Allowance will reduce from £1.8m to £1.5m.
This will have significant impact on clients with pension values above the Lifetime Allowance.
To claim fixed protection you will need to not make any contributions to a money purchase arrangement after 2012, not set up a new arrangement unless you are transferring to it and your application needs to have been made by 05 April 2012. In addition, special regard needs to be taken about the benefits built up in the NHS Pension Scheme.
So if this is an issue, and you would like to talk, call me on 01204 663904 or email Phil@white-well.co.uk
Tags: Fixed Protection, Lifetime Allowance, NHS Pension, NHS Pension Scheme | Posted in Fixed Protection |
Comments: No Comments yet!
Posted September 15th, 2011
I recently approached HMRC in relation to calculating how Added Years affects the benefits.
This was their response.
“The purchase of added years will presumably mean that the member’s pension entitlement at the end of the pension input period is higher than it would have been if they had not made the purchase. Consequently this would mean that the pension input amount for the period would be higher as it would include the additional benefits. You will need to contact the pension scheme to see how any contribution would affect the members benefits under the scheme.”
As you can see they were pretty unhelpful.
I have subsequently found out how this calculation works. It depends on the number of years being purchased and the time period over which the purchase is taking place. An adjustment factor is then used to deal with the accelerated accrual. So four added years purchased over 20 years would give an adjustment factor of 1.2.
If you are concerned about how your NHS pension benefits are affected by the Annual Allowance why not get in touch 01204 663904 or phil@white-well.co.uk
Tags: Added Years, Adjustment Factor, Annual Allowance, Member, NHS Pension, NHS Pension Benefits, Pension, Pension Entitlement, Pension Input Amount, Pension Input Period | Posted in Annual Allowance |
Comments: No Comments yet!
Posted September 5th, 2011
Fixed Protection – HMRC have set out their guidance and the forms needed to apply for fixed protection.
Do you need assistance with getting fixed protection in place before the 5 April 2012 deadline?
To recap, fixed protection protects your pension benefits at the current lifetime allowance level (£1.8million) rather than at the lower lifetime allowance (£1.5 million) from 6 April 2012 onwards.
It is relevant if you do not intend to draw benefits before 6 April 2012. If you are continuing in the NHS Pension scheme beyond April 2012 it is worth checking whether this valuable benefit is relevant to you.
So if you need advice on fixed protection and the lifetime allowance, please contact me 01204 663904 or email phil@white-well.co.uk
Tags: 5 April 2012, Current lifetime allowance, Draw Benefits, Fixed Protection, NHS Pension, NHS Pensions, £1.5 million, £1.8 million | Posted in Fixed Protection, NHS Pensions |
Comments: No Comments yet!
Posted September 2nd, 2011
I am currently assisting a Dr client of mine on lifetime allowance matters and I had the novel idea of approaching the NHS Pensions Agency to see if they could assist me.
At the time we believed he had exceeded his permitted benefit accrual and would lose his enhanced protection, so naturally we wanted to know, so that we could apply for fixed protection in good order. Who better to tell us than those administering the scheme. Wrong.
This is the responseI got (some time later):
“I can confirm that the NHS Pensions does not get involved with protecting pension rights from
the pension charges. At retirement we will send Dr X his pension award letter with the percentage on how much his pension is over the Lifetime Allowance rules.
Regarding protection of his pension he will need to contact HMRC for further details.”
I am still awaiting a response to my next later asking whether they felt they owed my client a duty of care to assist in the matter.
So we are left with not knowing before the event whether enhanced protection applies or not. I have developed a number of spreadsheets which help me to advise my medical clients on both lifetime allowance and annual allowance matters.
If you would like some assistance, please get in touch on
01204 663904 or email me phil@white-well.co.uk
Tags: Enhanced Protection, Lifetime Allowance, Lifetime Allowance Rules, Medical Clients, NHS Pension, NHS Pensions, Protecting Pension Rights, Retirement | Posted in Lifetime Allowance, NHS Pensions |
Comments: No Comments yet!
