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A quetstion on LTA and NEST contribution
snowshine
Posts: 148 Forumite
Works in NHS.
Age reached 60.
In the 1995 NHS pension scheme
Present calculation of pension shows Life Time Allowance Tax to be paid on tanking pension at age 60.
One takes the pension and pay the LTA tax on the crystallisation day.
Now after few months decides to re-join (get re-employed in NHS) and get automatically re-enrolled in "NEST" pension contributions.
What would happen to this accrued pension benefits in the "NEST" scheme when decides to stop working altogether on reaching state pension age: in this instance at 67 years old.
(What would happen to the accrued benefits in NEST?)
(Will have more than required number of years contributed in NI to have state pension)
Age reached 60.
In the 1995 NHS pension scheme
Present calculation of pension shows Life Time Allowance Tax to be paid on tanking pension at age 60.
One takes the pension and pay the LTA tax on the crystallisation day.
Now after few months decides to re-join (get re-employed in NHS) and get automatically re-enrolled in "NEST" pension contributions.
What would happen to this accrued pension benefits in the "NEST" scheme when decides to stop working altogether on reaching state pension age: in this instance at 67 years old.
(What would happen to the accrued benefits in NEST?)
(Will have more than required number of years contributed in NI to have state pension)
0
Comments
-
Look at NEST's website for options at retirement.
LTA charge will be payable as you've already exceeded this with your other pension benefits.0 -
Would the NHS even consider enrolling you in NEST?? Would have thought they wouldn't touch them with a bargepole.........Gettin' There, Wherever There is......
I have a dodgy "i" key, so ignore spelling errors due to "i" issues, ...I blame Apple
0 -
Why do you think so?
Any particular reason? Auto enrollment is what I understand takes place?
Yes, but if working for the NHS, it has it's own pension scheme they enrol you into, like the civil service and any number of private companies. NEST was just one of the basic schemes that (mainly) employers with no scheme of their own used to satisfy the auto-enrollment legislation.......Gettin' There, Wherever There is......
I have a dodgy "i" key, so ignore spelling errors due to "i" issues, ...I blame Apple0 -
Yes, but if working for the NHS, it has it's own pension scheme they enrol you into, like the civil service and any number of private companies. NEST was just one of the basic schemes that (mainly) employers with no scheme of their own used to satisfy the auto-enrollment legislation.
Depends if someone qualifies for membership of the NHS scheme - if not, NEST is the alternative. See (for example) https://www.uclh.nhs.uk/wwus/whatweoffer/Pages/Pensionscheme.aspx0 -
You are correct Brynsam
Those on 1995 NHS Pension scheme, when retires (on age grounds at 60) and return to NHS jobs are not allowed to join NHS pension again but NEST is available.0 -
That's what I like about this forum, learn something new every day
......Gettin' There, Wherever There is......
I have a dodgy "i" key, so ignore spelling errors due to "i" issues, ...I blame Apple0 -
If the money is designated as income, you’ll pay an LTA excess charge of 25%. As the income will be taxable, you’ll then likely pay higher rate tax on it.
If you take it as a lump sum, you’ll pay LTA excess charge of 55%.
You’d get no PCLS from it either.Not an expert, but like pensions, tax questions and giving guidance. There is no substitute for tailored financial advice.0
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