Teachers Pension and buying additional years

fizio

I am still waiting for TPS to see if this is possible but it does look like a lumpsum option is available. The TPS website suggests that a max of £6k annually can be purchased which equates to a one off lumpsum payment of approx £90k.
I'm not sure I can find another way to use £90k to fund a £6k pension for life (ISA etc already covered off)

OH is 50 so 10 years to NRA.

The 2 obvious questions for TPS if they confirm I can do this are:
1. Is it a one-off option only or can I buy in chunks as I don't have 90k lying around.
2. Does the £15k for £1k pension calculation change with age i.e would the numbers be the same if I did it in 5 years time..

Some good advice from various posters already but appreciate any more comments

Freecall

haf63 wrote: »

one off lumpsum payment of approx £90k.

Wow, your OH is a well paid teacher.

With that sort of salary it would be worth spreading it over a couple of years to maximise tax relief at higher rate.

Freecall

haf63 wrote: »

1. Is it a one-off option only or can I buy in chunks as I don't have 90k lying around.
2. Does the £15k for £1k pension calculation change with age i.e would the numbers be the same if I did it in 5 years time..

1. You can buy in £250 chunks

2. Yes, the older you are the more expensive it gets (up to about £20k just before retirement)

fizio

Freecall wrote: »

Wow, your OH is a well paid teacher.

With that sort of salary it would be worth spreading it over a couple of years to maximise tax relief at higher rate.

Wish that was the case but my OH has pretty much stopped working so 90k would come from me. I have maxed all my task-free investment options so thought I may as well bolster the OH's pension

jem16

Andy_L wrote: »

The extra pension will be CPI linked rather than RPI linked like the pension though.

Main pension has moved to CPI linking now.

Freecall

haf63 wrote: »

Wish that was the case but my OH has pretty much stopped working so 90k would come from me. I have maxed all my task-free investment options so thought I may as well bolster the OH's pension

I may have missed something here but she can't buy additional pension with unearned income.

jem16

Freecall wrote: »

I may have missed something here but she can't buy additional pension with unearned income.

Why can she not?

fizio

Freecall wrote: »

I may have missed something here but she can't buy additional pension with unearned income.

yeah. as far as i can tell you buy the additional pension with a lumpsum and its not connected to income

jem16

haf63 wrote: »

yeah. as far as i can tell you buy the additional pension with a lumpsum and its not connected to income

You will be limited to the annual allowance if you want tax relief on the lump sum but with your wife not earning you may hit a snag there.

Anything in excess of the annual allowance may be subject to a tax charge.

Freecall

jem16 wrote: »

Why can she not?

I was assuming that she wanted to recover tax and you can't recover tax from investment income via pension contributions.

I was trying to keep it simple.

For the avoidance of doubt, the OP implies that he would make the contribution from his assets and he can't reclaim the tax either.