Old Benefits
When you die - Old Benefits (Joined before 30 September 1996)
Your retirement pension is payable for life. On your death, the following benefits may be payable:
Five year guarantee
If you die within five years of your pension starting the trustees will make a lump sum payment, which is currently free of inheritance tax. It will be equal to the pension payments you would have received for the remainder of the five years at the rate payable immediately before your death, ignoring any levelling adjustment.
Alternatively, if you are in receipt of an ill health pension and die before normal retirement age, the lump sum will be equal to four times your pensionable salary when your service ceased, less any lump sum you chose to take on retirement under the cash option.
The trustees have discretion over who receives the cash and in what proportion. They will take into account your wishes regarding the choice of beneficiaries, but cannot be bound by them.
Qualifying spouse or nominated dependant
If you do not take a partial refund of your own contributions your qualifying spouse or nominated dependant will be entitled to two-thirds of your full pension.
Example (ignoring increases):
Mr Williams retires at age 60. His annual pension is £12,000. He commutes £3,200 for a lump sum of £32,000, leaving a reduced pension of £8,800. He nominates Mr Willis as his dependant.
Mr Williams dies two years after retirement. Mr Willis will receive:
A lump sum cash payment of £26,400 (ie £8,800 x 3); and an annual pension of £8,000 (ie £12,000 x 2/3) for the rest of his life.
Qualifying children
Your qualifying children will be entitled to a third share (two-thirds if there is no qualifying spouse) of your full pension.
Children cease to be eligible for a pension when they reach 18. At the trustees' discretion, they may continue to receive one until they finish full-time education - which is normally first degree or equivalent.
Discretionary pensions
If there is no qualifying spouse or nominated dependant, the trustees have discretion to award a pension to any person who was financially dependent on you at the date of your death or when your pension started.
The above information refers to the Old Benefits section.
New Benefits
When you die - New Benefits (joined 01/10/96 - 31/10/06)
Your retirement pension is payable for life. On your death, the following benefits may be payable:
Five year guarantee
If you die within five years of your pension starting the trustees will make a lump sum payment, which is currently free of inheritance tax. It will be equal to the pension payments you would have received for the remainder of the five years at the rate payable immediately before your death, ignoring any levelling adjustment.
Alternatively, if you are in receipt of an ill health pension and die before normal retirement age, the lump sum will be equal to four times your pensionable salary when your service ceased, less any lump sum you chose to take on retirement under the cash option.
Qualifying spouse or nominated dependant
Your qualifying spouse or nominated dependant will be entitled to half of your full pension.
Example (ignoring increases):
Mr Williams retires at age 60. His annual pension is £6,000. He commutes £1,125 for a lump sum of £13,500, leaving a reduced pension of £4,875. He nominates Mr Willis as his dependant.
Mr Williams dies two years after retirement. Mr Willis will receive:
A lump sum cash payment of £14,625 (ie £4,875 x 3); and an annual pension of £3,000 (ie £6,000 x 1/2) for the rest of his life.
Qualifying children
Your qualifying children (up to a maximum of two) will each be entitled to a quarter (half if there is no qualifying spouse) of the pension you would have received had you remained in pensionable service until normal retirement age, but based on your final pensionable salary at the date of your death.
Children cease to be eligible for a pension when they reach 18. At the trustees' discretion, they may continue to receive one until they finish full-time education - which is normally first degree or equivalent.
Discretionary Pensions
If there is no qualifying spouse or nominated dependant, the trustees have discretion to award a pension to any person who was financially dependent on you at the date of your death.
The above information refers to the New Benefits section.
Career Average Benefits
When you die - CAB (joined after 31/10/06)
Your pension is payable for life. On your death the following benefits are payable:
A dependant's pension
Your qualifying spouse, qualifying civil partner or nominated dependant will receive a dependant's pension of half your pension, as it would have been but for any commutation you chose to take.
Example (ignoring increases):
John retires at age 60. His annual pension is £8,000. He exchanges some of his pension for a lump sum and receives a lower pension. He nominates his father, Jack, as his dependant.
Following John's death, Jack will receive a pension of £4,000 for the rest of his life.
Children's pensions
Your qualifying children (up to a maximum of two) will each receive a pension equal to half of the dependant's pension. If no dependant's pension is payable, the children's pensions will be doubled.
A lump sum
If you are being paid an incapacity pension and die before normal pension age, the trustees will make a lump sum payment, which is currently free of inheritance tax. It will be equal to four times your pensionable salary as at the date you left service, less any lump sum you took in exchange for pension.
The trustees have discretion over who receives the cash and in what proportion. They take into account, but cannot be bound by, a member's wishes. You are therefore asked to let the trustees know your choice of beneficiaries by completing the expression of wish form on the downloads page.
The above information refers to the Career Average Benefits section.