NHS pension for 2001-2007

aroominyork

Coming back to this (which we had to put on ice for a few months to get paperwork from Australia), can I please confirm that for OH who was born in December 1957 and worked for the NHS for six years from 2001 to 2007, finishing on a salary of c.£50k, she is now entitled to claim:
1. A tax free lump sum of 3(50,000/80*6)=£11,250
2. Pension backdated to age 60 (say 4.5 years ago) of 4.5(50,000/80*6)=£16,875 taxed at the her marginal rate for the current tax year

3. Ongoing pension of 50,000/80*6=£3750 taxed at her marginal rate.

Also, is index linking applied to each of these to account for inflation?

Dazed_and_C0nfused

AIUI it's the other way round.

An inflation element is applied each year from when the pension was deferred and then the amounts due are calculated.

1.  Is 3x the pension

2.  If the NHS pension people have confirmed the arrears will be paid then yes it is taxable in the tax year it is paid unless you elect otherwise (see earlier posts).  Note this is something you sort with HMRC it is nothing to do with the NHS pension

3.  Whatever the pension is it will be taxed at her marginal rate although she may initially owe some tax to HMRC as the emergency tax code will be used on the first payment.  But HMRC should issue a D0 tax code (or SD1 code if Scottish resident) shortly after the first payment has been reported to them.

Flugelhorn

not sure that the lump sum will be index linked beyond 2017  as it will be payable as per the pension at the time of retirement ie 2017 (but of course it might be - I've not come across anyone getting back payments in the NHS pension, good news that she can! )

The pension will get index linked - the first bits will be by RPI then it was changed to CPI at some point. 

OH is same age - left scheme in 2005 after lots of years  and claimed in 2017 - the pension was approx 50% higher than it would have been based on salary and years at the time. 

aroominyork

Flugelhorn said:

not sure that the lump sum will be index linked beyond 2017  as it will be payable as per the pension at the time of retirement ie 2017 (but of course it might be - I've not come across anyone getting back payments in the NHS pension, good news that she can! )

That makes sense - a piece of 'use it or lose it' which, since it seems she might soon receive c.£30k (about half of it taxable) we can manage to swallow 

Flugelhorn

@aroominyork worth bearing in mind that the quoted 3750 you  have there could be a fair bit higher as will have had RPI then CPI added every year since 2007

ggmf

aroominyork said:

Coming back to this (which we had to put on ice for a few months to get paperwork from Australia), can I please confirm that for OH who was born in December 1957 and worked for the NHS for six years from 2001 to 2007, finishing on a salary of c.£50k, she is now entitled to claim:
1. A tax free lump sum of 3(50,000/80*6)=£11,250
2. Pension backdated to age 60 (say 4.5 years ago) of 4.5(50,000/80*6)=£16,875 taxed at the her marginal rate for the current tax year

3. Ongoing pension of 50,000/80*6=£3750 taxed at her marginal rate.

Also, is index linking applied to each of these to account for inflation?

Skim reading back through the thread (so may have missed some info), why are you calculating this? did she obtain a statement from NHS pensions in writing or through TRS?, this will confirm what her entitlements should be.

Flugelhorn

ggmf said:

aroominyork said:

Coming back to this (which we had to put on ice for a few months to get paperwork from Australia), can I please confirm that for OH who was born in December 1957 and worked for the NHS for six years from 2001 to 2007, finishing on a salary of c.£50k, she is now entitled to claim:
1. A tax free lump sum of 3(50,000/80*6)=£11,250
2. Pension backdated to age 60 (say 4.5 years ago) of 4.5(50,000/80*6)=£16,875 taxed at the her marginal rate for the current tax year

3. Ongoing pension of 50,000/80*6=£3750 taxed at her marginal rate.

Also, is index linking applied to each of these to account for inflation?

Skim reading back through the thread (so may have missed some info), why are you calculating this? did she obtain a statement from NHS pensions in writing or through TRS?, this will confirm what her entitlements should be.

NHSBSA are incredibly slow on statements and if deferred don't give the final figures until you actually apply for the pension, also not sure if they had TRS in 2007 - I can't remember when it started.
OH left 2005 - had zilch from pensions until he applied in 2017 - then got statement saying "this is the amount" 

ggmf

Flugelhorn said:

ggmf said:

aroominyork said:

Coming back to this (which we had to put on ice for a few months to get paperwork from Australia), can I please confirm that for OH who was born in December 1957 and worked for the NHS for six years from 2001 to 2007, finishing on a salary of c.£50k, she is now entitled to claim:
1. A tax free lump sum of 3(50,000/80*6)=£11,250
2. Pension backdated to age 60 (say 4.5 years ago) of 4.5(50,000/80*6)=£16,875 taxed at the her marginal rate for the current tax year

3. Ongoing pension of 50,000/80*6=£3750 taxed at her marginal rate.

Also, is index linking applied to each of these to account for inflation?

Skim reading back through the thread (so may have missed some info), why are you calculating this? did she obtain a statement from NHS pensions in writing or through TRS?, this will confirm what her entitlements should be.

NHSBSA are incredibly slow on statements and if deferred don't give the final figures until you actually apply for the pension, also not sure if they had TRS in 2007 - I can't remember when it started.
OH left 2005 - had zilch from pensions until he applied in 2017 - then got statement saying "this is the amount" 

Thanks, but that has not been my experience. My TRS detailed on sperate tabs my 1995, 2008 and 2015 entitlements, agreed written statements take longer, but had mine in about 6 weeks.

Flugelhorn

@ggmf As I said not sure whether the TRS accounts were fully implemented until after the OP had left the scheme - my OH certainly never had one (or the offer of one later ) after he left in 2005. 

Re delays - many colleagues had to wait months for statements  and if there was any practitioner pay in the equation that was not included for 18/12 or so after the work was done. My final pension amount was settled 15 months after I took my pension and 4 years after I left the scheme

aroominyork

We do not have TRS yet because OH needs to send marriage certificate with the application forms and we hadn't realised until now that after getting married in Australia in 2005 we hot-footed it on honeymoon and never thought to get the certificate! It's currently en route from the authorities in Melbourne so we will apply to NHS next week.