With preserved pension now catching up with CPI index linking at 60 rather than 55...

Discussion in 'Finance & Pensions' started by 3yearstilltx, Oct 15, 2012.

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  1. does anyone know what adjustments have been made to commutation?Basically your commutation is taking some of your pension up front, so what adjustments have been made to allow for the fact you'll be repaying it for 5 years longer?On the pension calculator my pension is the same as it was before the new age of "catchup" will the amount my monthly remaining pension being deducted by change to allow for the fact I'm paying that commutation back 5 years longer? as I can't see it.Still it could be worse as those leaving after 2015 will get there lump sums taxed
  2. Remember where you heard it.Announcement date: Oct 2014Implementation date: March 2015 (5 months later)To avert mass mass exodus on 12 months notice.
  3. chieftiff

    chieftiff War Hero Moderator

    I assume you are in AFPS 75, in which case nothing is being done because you commute your pension as part of the immediate pension in payment scheme so nothing changes, you will have paid it off by 55.
  4. I was under the impression though I'd be on the same money till 60 rather than 55, so if this is the case, why has it not gone up to what it should be if I wasn't repaying the commutation?
  5. chieftiff

    chieftiff War Hero Moderator

    No, that change only applies to preserved pensions not pensions in payment, if somebody left after the 12 year point but before 22 this change will have an effect on the date they start to receive their pension, the change does not affect you if you complete 22. I believe it may also have an effect on the date any previous spouse with a pension sharing order can start to claim. Have a read of the leaflet I linked to on the other thread.
  6. I'm glad your hear to make sense of the madness. Cheers CT. So we are safe? Lift the ladder up Jack.....
  7. 12 clips I heard that too. What makes you so sure? ATG said my old branch was shutting down in 2012......
  8. " Originally Posted by SJRM_RN My Bold: Absolute bollox12 clips I heard that too. What makes you so sure? ATG said my old branch was shutting down in 2012...... "Theres a Major in Andover where the HQ of Management Accountant Services (Army) re-located to from The FASC (Sandhurst) a few years back.On his desk as part of the drive to save money is the draft paper for this very subject, at one point it was to be announced next year, but is held by 1 year because they wanted to see how much natural wastage there would be this year following 12 month notice submissions after the dust settled following the 2012 redundancies (those who didn't get it).Also they want it implemented before the General election in 2015......Part of the justification is that private sectors golden handshakes are taxable and they plan to call the 'legality' of these tax free 'bounties' their words into question.People uttered the words bollox, when we first got wind that those on AFP75 would be forced onto 05 in late 2012/early 2013 when that was first mentioned.....turned out to be true!
  9. chieftiff

    chieftiff War Hero Moderator

    Anybody in the UK can take up to 25% of their pension savings as a tax free lump sum providing that sum doesn't exceed 25% of the lifetime allowance for that tax year. For 2012/13 that lifetime alowance is £1.5M.

    So actually very few people pay any tax at all on their pension lump sum private or not, there have been some discussions about reducing the lifetime allowances but nothing serious, any change made to the armed forces pension schemes with regards to tax and lump sums would have to reflect changes in wider society in this area. Do you seriously think any political party that would like to govern is going to authorise the effective confiscation of up to 25% of somebody's retirement lump sum (currently anything over the lifetime allowance is taxed at 25%) - money that would be removed from the the wider economy and is factored into retirement plans to pay off mortgages, loans etc and once in a lifetime holidays. I can't see it or anything significant like it happening in this area.
    Last edited: Oct 15, 2012
  10. Then it may interest you to know that an average chief with between 16-30 years service who switches from AFP75 to 05, and is subsequently NSMBOS'd ends up worse off to the tune of over £200,000 over an expected lifetime of around 25 years?And you think they wouldn't be scared to take 15k from my pension LMAO
  11. chieftiff

    chieftiff War Hero Moderator

    Unfortunately pussers pensions are now all linked to CPI so have already lost a few grand over their lifetime, my company pension is still RPI linked but not for long I fear!
  12. chieftiff

    chieftiff War Hero Moderator

    Not really, you missed my point about the service rule on tax free lump sums merely reflecting the HMRC rules. I think at this point it is worth mentioning that anyone who makes a change to his/her pension arrangements without seeking professional advice is likely to do themselves and their family a great diservice, it's complicated and I'm not a professional, I understand my pensions and their arrangements because its in my interest to, I don't get paid to give advice.
  13. Mate, my last few months in the RN accrue pension benefits under 05, with all benefits accrued under 75 already in the bag.Soon everyone moves onto 05.Maybe it's your good self needs to look harder.As for the taxing of lump sums in the future, wait and see.The cut in over £200k following NSMBOS after transfer to 05, is from when I was the Chief of the NSMBOS. It happened to two individuals while I was there.
  14. Sorry if my terminology isn't great on this, I'm an MA....lolYes I am under 45 and not leaving till the end of the year so accruing under 05 sorry but being on th enew scheme/accruing under the new scheme seems like shite=jobby to me lolNot trying to spread anything nasty
  15. think you will find that like most final year salary pensions are RPI linked to annual rises, and are set in stone, as it is specified into that particular company pension trust deed act and cannot be altered.........unless the trustees want to try and change it!!!!!!!
  16. Well as my tax free lump was spent many moons ago, I do not think I will worry on this one.
    If you leave on AFPS75 and you have any injuries aches and pain etc. put a marker down and claim a war pension, you may get nothing now but if things get worst you can re-apply against the original. If you leave it for more than 7 years you have to prove it was the service that screwed you up, when you first leave they have to prove it was not their fault.
    Learned this from a British Legion brief before I left, they also helped with all the paperwork.
  17. wave_dodger

    wave_dodger War Hero Book Reviewer

    Absolute a utter crap and you know why, SPVA can't implement anything that large in that timeline! I a also believe to alter the T&C of a pension to that extent requires parlimentary approval. Not 100% certain of that element.

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