Teachers Pension Scheme

Transcription

1 Teachers ension Scheme inal salary section and career average section Non-Club incoming transfers actors and guidance Date: 13 March 2015 Author: Matt Wood and Donal Cormican

2 actors and guidance - 13 March 2015 Contents 1 Introduction 1 2 Service credit formula inal salary section, NA Service credit formulae inal salary section, NA ension credit formula Career average section 4 actors inal salary section, NA 60 5 actors inal salary section, NA 65 7 actors Career average section 9 GAD seeks to achieve a high standard in all our work. lease go to our website for details of the standards we apply.

3 actors and guidance - 13 March Introduction 1.1 This note is provided for the Department for Education (DfE) as scheme manager of the Teachers ension Scheme (TS). It sets out how to determine the appropriate service credit or pension credit for incoming non-club transfers into the TS. 1.2 A service credit in respect of a non-club transfer value may be awarded in the final salary section of the TS in accordance with aragraph 12(2) of Schedule 6 to The Teachers ensions Regulations 2010 (SI 2010/990). A pension credit in respect of a non-club transfer value may be awarded in the career average section of the TS in accordance with aragraph 206 of the Teachers ension Scheme Regulations 2014 (SI 2014/512). 1.3 The factors provided in this note have been prepared in light of our advice to DfE dated 19 ebruary 2015 and its instructions following that advice. 1.4 This note sets out how to determine the appropriate service credit or pension credit for members aged below their normal pension age (NA). Cases involving members above their NA should be referred to GAD. 1.5 The formulae and factors for calculating the service credit or pension credit to be awarded are set out in the following sections: > Section 2 covers the calculation of the service credit to be awarded to a NA 60 member in the final salary section. The relevant factors are set out in Appendi A. > Section 3 covers the calculation of the service credit to be awarded to a NA 65 member in in the final salary section. The relevant factors are set out in Appendi B. > Section 4 covers the calculation of the pension credit to be awarded to a member in the career average section. The relevant factors are set out in Appendi C. 1.6 DfE have decided that the implementation date for the factors applying to the final salary section will be 1 April The factors will apply to the career average section from 1 April Under eisting arrangements for members transferring comparable United Kingdom service (CUKS) ie other statutory teachers schemes in the United Kingdom these have been undertaken on a day-for-day basis. These arrangements are now time limited and will only apply to those who join a CUKS scheme on or before 31 March 2015 and apply for the transfer on or before 31 March This criteria is set out in regulation 34C of the Teachers ensions Regulations 2010 (SI 2010/990). This note should be used to calculate the service credit awarded to a member who is transferring service from a CUKS scheme but who does not meet the criteria set out above on or after 1 April This note only covers non-club incoming transfers into the TS. Different instructions and factors should be used to calculate service credits or pension credits for transfers made in accordance with the ublic Sector Transfer Club. 1

4 actors and guidance - 13 March Service credit formula inal salary section, NA This section illustrates how a service credit should be calculated for a member who is transferring service into the NA 60 final salary section of the TS. 2.2 The service credit awarded to the member should be calculated as: service = pre post post88gmp G [ CETV + ( G + G ) ] LS S CS where CETV CS = the member s incoming transfer value = member s final contributable salary () at the relevant date pre G = pre-88 GM (pa) accrued by member at the relevant date post G = post-88 GM (pa) accrued by member at the relevant date = relevant gross pension factor for a member aged LS = relevant lump sum factor for a member aged S = relevant survivor s pension factor for a member aged G = relevant GM factor for a member aged post88gmp = 0.15 for all members 2.3 The relevant factors are set out in Appendi A. actors should be selected with reference to a member s se and age. 2

5 actors and guidance - 13 March Service credit formulae inal salary section, NA This section illustrates how a service credit should be calculated for a member who is transferring service into the NA 65 final salary section of the TS. 3.2 The formula to use is different for males and females. Men: service = where pre post post88gmp G [ CETV + ( G + G ) ] S CS CETV = the member s incoming transfer value CS = member s final contributable salary () at the relevant date pre G = pre-88 GM (pa) accrued by member at the relevant date post G = post-88 GM (pa) accrued by member at the relevant date S = relevant gross pension factor for a member aged = relevant survivor s pension factor for a member aged G = relevant GM factor for a member aged post88gmp Women: service = where = 0.15 for all members pre Gpre post Gpost [ CETV + ( G + G )] S CS CETV = the member s incoming transfer value CS = member s final contributable salary () at the relevant date pre G = pre-88 GM (pa) accrued by member at the relevant date post G = post-88 GM (pa) accrued by member at the relevant date S = relevant gross pension factor for a member aged = relevant survivor s pension factor for a member aged Gpre = relevant GM factor for pre-88 GM for a member aged Gpost = relevant GM factor for post-88 GM for a member aged 3.3 The relevant factors are set out in Appendi B. actors should be selected with reference to a member s se and age. 3

6 actors and guidance - 13 March ension credit formula Career average section 4.1 This section illustrates how a pension credit should be calculated for a member who is transferring pension into the career average section of the TS. 4.2 The pension credit awarded to the member should be calculated as: pension credit = where CETV pre Gpre post Gpost [ CETV + ( G + G )] S = the member s incoming transfer value pre G = pre-88 GM (pa) accrued by member at the relevant date post G = post-88 GM (pa) accrued by member at the relevant date = relevant gross pension factor for a member aged S = relevant survivor s pension factor for a member aged Gpre = relevant factor for pre-88 GM for a member aged Gpost = relevant factor for post-88 GM for a member aged 4.3 The relevant factors are set out in Appendi C. actors should be selected with reference to a member s NA, 1 se and age. Members with non-integer NAs 4.4 Where a member has a non-integer normal pension age, then factors should be interpolated. or eample, for a member with a normal pension age of 67 years and 2 months the main pension factor would be: ( NA 67 years 2 months) = ( NA 67) + {2 12 [ ( NA 68) ( NA 67)]} 1 Normal pension age is defined as a member s state pension age (or 65, if that is higher) in the career average section. or the purpose of this note, a member s epected NA in the career average section is the same as their state pension age as set out in The ublic Service ensions (Valuations and Employer Cost Cap) Directions s_and_cost_cap_directions_reconsolidated_sept_2014.pdf 4

7 actors and guidance - 13 March 2015 actors inal salary section, NA 60 Table actors for non-club incoming transfers men, NA 60 Age last birthday at relevant date Gross ension of 1 per Lump sum of 1 ension of 1 GM of 1 per When calculating the deduction for GM, the factor given should be applied to the sum of the GM amount in respect of service up to 5 April 1988 and 15% of the GM amount in respect of service after that date. 5

8 actors and guidance - 13 March 2015 Table actors for non-club incoming transfers women, NA 60 Age last birthday at relevant date Gross ension of 1 per Lump sum of 1 ension of 1 GM of 1 per When calculating the deduction for GM, the factor given should be applied to the sum of the GM amount in respect of service up to 5 April 1988 and 15% of the GM amount in respect of service after that date. 6

9 actors and guidance - 13 March 2015 actors inal salary section, NA 65 Table actors for non-club incoming transfers men, NA 65 Age last birthday at relevant date Gross ension of 1 ension of 1 GM of When calculating the deduction for GM, the factor given should be applied to the sum of the GM amount in respect of service up to 5 April 1988 and 15% of the GM amount in respect of service after that date. 7

10 actors and guidance - 13 March 2015 Table actors for non-club incoming transfers women, NA 65 Age last birthday at relevant date Gross ension of 1 ension of 1 per Deduction 1,2 for re-88 GM of 1 Deduction 1,2 for ost-88 GM of Separate factors are given for the pre-88 GM (accrued up to 5 April 1988) and post-88 GM (accrued after that date). 2. When calculating the deduction for GM for females aged 60 or above, the factors given should be applied to the annual amount of the GM after the late retirement increase of 1/7% per week plus any statutory pension increases the GM would have received it if was in payment. 8

11 actors and guidance - 13 March 2015 actors Career average section Table CA_TVIN65M - actors for non-club incoming transfers men, NA 65 Age last birthday at relevant date Gross ension of 1 ension of 1 per Deduction for re- 88 GM of 1 per Deduction for ost-88 GM of

12 actors and guidance - 13 March 2015 Table CA_TVIN65 - actors for non-club incoming transfers women, NA 65 Age last birthday at relevant date Gross ension of 1 ension of 1 per re-88 GM of 1 ost-88 GM of When calculating the deduction for GM for females aged 60 or above, the factors given should be applied to the annual amount of the GM after late retirement increase of 1/7% per week plus any statutory pension increases the GM would have received it if was in payment. 10

13 actors and guidance - 13 March 2015 Table CA_TVIN66M - actors for non-club incoming transfers men, NA 66 Age last birthday at relevant date Gross ension of 1 ension of 1 per re-88 GM of 1 ost-88 GM of When calculating the deduction for GM for males aged 65 or above, the factors given should be applied to the annual amount of the GM after late retirement increase of 1/7% per week plus any statutory pension increases the GM would have received it if was in payment. 11

14 actors and guidance - 13 March 2015 Table CA_TVIN66 - actors for non-club incoming transfers women, NA 66 Age last birthday at relevant date Gross ension of 1 ension of 1 per re-88 GM of 1 ost-88 GM of When calculating the deduction for GM for females aged 60 or above, the factors given should be applied to the annual amount of the GM after late retirement increase of 1/7% per week plus any statutory pension increases the GM would have received it if was in payment. 12

15 actors and guidance - 13 March 2015 Table CA_TVIN67M - actors for non-club incoming transfers men, NA 67 Age last birthday at relevant date Gross ension of 1 ension of 1 per re-88 GM of 1 ost-88 GM of When calculating the deduction for GM for males aged 65 or above, the factors given should be applied to the annual amount of the GM after late retirement increase of 1/7% per week plus any statutory pension increases the GM would have received it if was in payment. 13

16 actors and guidance - 13 March 2015 Table CA_TVIN67 - actors for non-club incoming transfers women, NA 67 Age last birthday at relevant date Gross ension of 1 ension of 1 per re-88 GM of 1 ost-88 GM of When calculating the deduction for GM for females aged 60 or above, the factors given should be applied to the annual amount of the GM after late retirement increase of 1/7% per week plus any statutory pension increases the GM would have received it if was in payment. 14

17 actors and guidance - 13 March 2015 Table CA_TVIN68 M - actors for non-club incoming transfers men, NA 68 Age last birthday at relevant date Gross ension of 1 ension of 1 per re-88 GM of 1 ost-88 GM of When calculating the deduction for GM for males aged 65 or above, the factors given should be applied to the annual amount of the GM after late retirement increase of 1/7% per week plus any statutory pension increases the GM would have received it if was in payment. 15

18 actors and guidance - 13 March 2015 Table CA_TVIN68 - actors for non-club incoming transfers women, NA 68 Age last birthday at relevant date Gross ension of 1 ension of 1 per re-88 GM of 1 ost-88 GM of When calculating the deduction for GM for females aged 60 or above, the factors given should be applied to the annual amount of the GM after late retirement increase of 1/7% per week plus any statutory pension increases the GM would have received it if was in payment. 16