- Your pension at age 60
- Cash lump sum
- Pension increases
- Can I take my pension early?
- How are pensions paid?
- Do I get a payslip?
- Does my pension increase in payment?
You are entitled to a pension for life of 1/60th of your 'final salary' for the years and days of contributory membership up to 30 September 2007. If you have been working part-time, your Pensionable Service will be adjusted to take this into account.
Your pension will be increased broadly by the rise in the Consumer Prices Index (subject to a maximum of 5% per year), for the period between the date you left Service and the date you take your pension.
On retirement you may exchange part of your pension for a cash sum, which is currently tax-free. XPS Administration will provide details of this option shortly before your retirement.
If you take early retirement, the earliest age you can ask to take your pension from (unless you are retiring on the grounds of incapacity) is age 55.
If you draw your benefits early, your pension will be reduced to take account of the fact that it will be paid to you for longer than it would have been had you waited until age 60. Your cash sum will also be lower as a result.
Early retirement requires the consent of the Trustee.
Pensions and children's allowances are paid in advance on or around the 6th of each month. These payments will be made direct to a nominated bank or building society account. Pensions and children's allowances are liable for income tax under PAYE, which we will deduct before payment, as appropriate.
Payslips are issued whenever there is a change to your pension such as in April when pensions are increased or if your tax code changes.
The Scheme increases pensions and children's allowances on 1 April each year. The increase is based on price inflation over the previous year up to a maximum as explained below.
Pension from Pensionable Service before 6 April 2005 will be increased in line with price inflation up to a maximum of 5% a year.
Pension from Pensionable Service on and after 6 April 2005 up to 30 September 2007 will be increased in line with price inflation up to a maximum of 2.5% a year.
Some pensions will include a guaranteed minimum pension (GMP). This part of the pension is increased separately. Once you have reached State Pension Age, the State pays inflation-linked increases on GMPs earned before 6 April 1988. The Scheme pays increases on GMPs earned from 6 April 1988 onwards. These increases are also linked to inflation, but limited to 3% a year.
Pensions that have been in payment for less than a year may receive a proportionate increase.