Teachers pension compensation mpaa?

Narrowboat

Hi, I am due to receive a small (<£100) cash payment from Teachers Pension, which will be subject to tax. I am not yet retired and not drawing any pension. The payment is because of the McCloud judgment - my Career Average pension built up during the transitional period is being moved back to Final Salary. But any overtime from this period is no longer pensionable under Final Salary. So TPS are refunding overtime pension contributions. I would be surprised if this triggered MPAA, but it is a taxable cash payment from my pension administrators, with the amount being defined by my previous contributions. So I was just wondering if anyone knows for certain if MPAA is triggered (yes I could ask TPS but I am really struggling to get them to deal with a much bigger issue for me at the moment). Thanks.

hugheskevi

It does not trigger MPAA.

Also, it is not a taxable cash payment. You will receive non-taxable compensation, and the calculation of the compensation will take into account the tax relief you previously received on the contribution along with interest. But the compensation itself is not taxable.