Auto enrolment on to new pension after claiming NHS pension and returning to (NHS) work.

Korkyb

I believe that returning to NHS employment following my "retirement" from the NHS pension scheme that I will be auto enrolled into a new pension (I wont be able to rejoin the NHS Scheme).

I understand that paying into this new pension will reduce the tax I pay but apart from that dont have much more information. (my pension is £25k ish so will be paying tax).

Questions I have are:

- Would it be worth increasing the amount I pay in? (?? its 5%).

- What happens to this money if I die? (would my wife be able to access it?).

- When I stop working would I be able to get hold of this money & if so would I have to pay tax?

If anyone can point me in the right direction it would be much appreciated.

xylophone

https://www.nhsbsa.nhs.uk/sites/default/files/2018-05/Returning to work after retirement factsheet (V6) 05.2018.pdf

Does the above help?

Korkyb

xylophone said:

https://www.nhsbsa.nhs.uk/sites/default/files/2018-05/Returning to work after retirement factsheet (V6) 05.2018.pdf

Does the above help?

Unfortunately not - that just confirms that I'm unable to rejoin the NHS scheme.

Thanks anyway.

xylophone

https://www.nhsbsa.nhs.uk/sites/default/files/2017-03/Auto enrolment Employer FAQs (03.2017) (V7).pdf

Then will you be enrolled into NEST?

If not, which scheme will your employer offer?

MX5huggy

Presuming it’s a fairly standard Defined Contribution pension. Then yes it’s a good idea to pay in more, you get the tax relief on contributions then on withdrawals you get 25% out tax free, this has a 6.25% benefit without any growth of the investment.

Yes you wife can have the money, fill out the declaration of wishes. 

You can get hold of it before you stop working if you wish (there are reasons not to). You get 25% tax free then pay tax on the rest so if it is a lot pushing you into higher rate tax you would want to spread receiving it over  a number of years. 

dunstonh

- Would it be worth increasing the amount I pay in? (?? its 5%).

Yes.  Anything you pay into the pension tax wrapper gets tax relief and on withdrawal, if you remain a basic rate taxpayer, you pay less tax than the relief you obtained.  i.e. free money.

- What happens to this money if I die? (would my wife be able to access it?).

It is paid to your beneficiaries (wife in this case). She can either take it as a lump sum or convert it to a beneficiary drawdown pension and take withdrawals from it as needed.   There are pros and cons on the different methods but she only needs to worry about that at the time of your death. No decision is needed in advance.

- When I stop working would I be able to get hold of this money & if so would I have to pay tax?

yes and yes.

Korkyb

xylophone said:

https://www.nhsbsa.nhs.uk/sites/default/files/2017-03/Auto enrolment Employer FAQs (03.2017) (V7).pdf

Then will you be enrolled into NEST?

If not, which scheme will your employer offer?

Yes I believe it will be NEST that I'm enrolled in.

MX5huggy

Korkyb said:

xylophone said:

https://www.nhsbsa.nhs.uk/sites/default/files/2017-03/Auto enrolment Employer FAQs (03.2017) (V7).pdf

Then will you be enrolled into NEST?

If not, which scheme will your employer offer?

Yes I believe it will be NEST that I'm enrolled in.

NEST has an unusual charging structure. 1.8% of contributions then a flat Annual management charge (AMC) of 0.3% 

Most only charge an AMC but higher generally. NEST fee benefits those using them for years as you won’t be you may be better off looking elsewhere for somewhere to put additional pension payments. But you should stick with them for money from your job (ie don’t opt out). 

xylophone

Information re NEST

https://www.nestpensions.org.uk/schemeweb/nest/my-nest-pension.html

https://www.nestpensions.org.uk/schemeweb/nest/my-nest-pension/what-happens-to-my-pension-when-I-die.html

https://www.nestpensions.org.uk/schemeweb/memberhelpcentre/contributions/make-additional-contributions.html

Korkyb

Magic

Just what I needed.

Thanks all.

SacredStephan

Korkyb said:

I understand that paying into this new pension will reduce the tax I pay 

Unlike your contributions to the NHS pension (superannuation) your contributions to NEST will not reduce the tax that you pay.