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How to increase your retirement benefits
As well as making your regular contributions to your firefighters' pension, you can pay more to increase the amount you'll receive in retirement.
Additional Pension is an amount of extra pension that can be bought while you’re in employment. It covers an increase in pension for yourself AND for any pension payable to your dependants (spouse, partner or dependent children) after your death. It’s then paid in addition to your scheme benefits when you retire.
You can only buy Additional Pension if you’re an actively contributing member of the Firefighters' Pension Scheme 2015 and haven’t reached your normal pension age.
The cost of purchasing Additional Pension depends on:
- your age at the date of your election
- the amount you wish to purchase
- whether you’re paying by lump sum or regular contributions
Maximum purchase amounts
The maximum amount is £6500 for the Firefighters' Pension Scheme 2015. The maximum amounts allowable change from time to time and details are published on our website.
If you choose to take out more than one contract, we’ll take into account the value of all of your contracts to ensure you don’t exceed the maximum allowable amount.
You can pay for Additional Pension either by lump sum or by making regular contributions through your salary.
Lump sum payments
An election to pay added pension payments with a lump sum payment may only be made if the member gives notice to the scheme manager not later than 12 months after the date on which the person last became employed by the authority as a firefighter.
You can make regular payments from your salary through the PAYE system and you'll receive tax relief each time a payment is made.
You have to commit to paying the regular Additional Pension contributions for at least one year and the contract must finish before you reach your normal pension age.
The contract also needs to start at least two years before your normal pension age. If you've already made an agreement with the scheme manager to leave the the scheme with entitlement to a pension or an ill-health award, you can't take out an Additional Pension contract.
It’s your responsibility to ensure your employer is deducting the correct amount from your salary. If you identify an error, you should contact them immediately.
Additional Pension and the Annual Allowance
If the growth in your benefits exceeds the Annual Allowance, you may be subject to an Annual Allowance charge. Given the potential tax consequences, you should seek advice from an Independent Financial Advisor if you’re planning to make a lump sum payment to purchase additional pension. Please see HMRC’s website for more information about the Annual Allowance.
Retirement options that affect Additional Pension
There are a number of circumstances that affect the amount of Additional Pension payable to you. If you chose to receive your pension early, your Additional Pension will be reduced as it is being paid earlier.
If you continue to work beyond your normal pension age, your Additional Pension will be increased to reflect the later than expected payment.
Benefits payable on death
If you've been paying Additional Pension contributions for 12 months, your dependants would receive a pension of 50% of what you would have received. The dependant's pension would be paid in full, even if you haven't completed all the payments, as long as you were in good health when the contract was taken out.
How to apply
When you use our Additional Pension calculator it will create your estimate and produce a printable application form. If you'd like a formal quote please sign the completed application form and return it to SPPA. We'll then check the figures and either make arrangements to collect your lump sum or forward the details to your payroll department so they can start taking deductions.