Your pension, extra information
Leaving your employer
If you leave your current employer or decide to stop contributing in to your pension pot, your pension savings will remain with The People’s Pension (further information is available on request).
Even if you move jobs you can keep paying into The People’s Pension. Your former employer will no longer contribute, but your new employer may.
You may be able to transfer your pension pot to another registered pension scheme. We do not charge for transfers out of The People’s Pension.
If you leave but then come back to The People’s Pension in the future, we’ll reactivate your existing pension pot and make sure any new contributions go into that. You’ll only ever have one pension pot with us.
Taking your benefits
We’ll contact you before your selected retirement age explaining your options and how to access your savings.
Your choices at retirement
Read about the different ways you can take your pension
You can’t normally access your pension savings before you reach age 55 (the government proposes to increase this to age 57 from 2028). This doesn’t mean you’d have to have to stop working to access your money though.
You could access your pension savings earlier if on medical grounds you’re unable to continue your occupation, and as a result you have stopped working. If you’re suffering from serious ill health (a life expectancy of less than 12 months), it may be possible for you to receive your entire pension pot as a serious ill health lump sum.
What happens to my pension if I die before I retire?
If this happens to you, the value of your pension pot will be paid as a lump sum to one or more of your beneficiaries. The lump sum is normally tax-free.
You can tell the Trustee which people or organisations you would like it to consider as your beneficiaries using your Online Account.
Know how on taxes
The government wants to encourage us all to save for our retirement so they provide something called tax relief.
The maximum amount you can save into all of your pension arrangements each tax year before incurring a tax charge is limited to an annual allowance. This is £40,000 for the current tax year (2018/2019).
This limit includes all your contributions, tax relief and employer contributions across all your pension arrangements.
If you go over the annual allowance limit, this will result in a tax charge, known as the annual allowance charge.
Your annual allowance will be reduced if:
- you take cash lump sums from your pension savings as flexible lump sums (otherwise known as uncrystallised funds pension lump sums, or UFPLS) or start taking an income from a flexi-access drawdown. If you decide to do this, you’ll be subject to a reduced money purchase annual allowance of £4,000 for future savings made into a defined contribution pension, like The People’s Pension.
- you have a high income. This affects those with ‘adjusted income’ (which includes the value of any pension savings made in the tax year) of over £150,000 and who have a ‘threshold income’ (which excludes your pension savings) in excess of £110,000. If you have an adjusted income for a tax year of more than £150,000, then your annual allowance for that tax year will be reduced on a tapered basis. This means, for every £2 of adjusted income above £150,000, your annual allowance will reduce by £1. The maximum reduction is £30,000, so anyone with an adjusted income of £210,000 or more will have an annual allowance of £10,000.
Find out more about the tapered annual allowance on HMRC’s website »
If you exceed the annual allowance or, if applicable, the money purchase annual allowance, a tax charge may apply to the excess.
As well as an annual allowance there is a maximum amount you are able to save into a pension scheme and receive tax relief.
This is called the lifetime allowance and is the overall limit on the pension savings that qualify for tax relief and will apply to all of the pension benefits you build up over your entire working life.
From 6 April 2018, the limit is £1.03 million.
B&CE Financial Services (B&CE) and its associated companies (including The People’s Pension Trustee Limited) collect and use personal information about their scheme members. All personal data is held and processed in accordance with The Data Protection Act 1998.