You can add value to your Teachers’ pension by transferring former pension rights
12 month transfer deadline
To maximise your benefits, transfers must be completed within 12 months of joining the Scottish Teachers’ Pension Scheme and before your normal pension age. SPPA won’t accept responsibility for any delays incurred by you or your previous pension provider.
Unlike most other pension transfers we must provide you with an estimate of your potential benefits to allow you to make an informed choice whether to transfer or not. This is a time consuming process which is why we ask for your immediate co-operation at all times.
When you join the Scottish Teachers’ Pension Scheme, you’re able to transfer pension savings you’ve accumulated elsewhere in order to increase your final pension from the Teachers’ scheme. We can accept transfers from most pension schemes registered with HM Revenue & Customs (HMRC) including Recognised Overseas Pension Schemes.
This is a valuable benefit and it’s well worth considering as soon as you join the scheme.
What is a transfer value?
A transfer value (or Cash Equivalent Transfer Value) is a cash valuation of your existing pension benefits. It will be calculated by your previous scheme and it’s the amount of money they’ll provide in exchange for you giving up your rights in their former scheme.
That transfer value is then used to work out how much additional pension rights can be provided in your new scheme. We use guidelines supplied by the Government Actuary’s Department to make this calculation and once a transfer value has been paid, you’ll have no further claim to pension rights from your former scheme or plan.
Who can apply for a pension transfer?
Transfer payments are only accepted from active scheme members. You should note that if you’re working as a probation or supply teacher and you’re contributing to the scheme then your eligible start date will be when you started paying contributions.
If you opt out of your scheme before a transfer payment is received the transfer will be cancelled. In cases like this, subsequent requests to transfer are treated as new applications and are subject to the 12 months’ timescales from your date of eligible membership.
If you leave your new scheme with less than 2 years’ service (including in that period any completed transfer in) you may be entitled to a refund but you should note that any transferred in credit from a pension scheme outside the public sector can’t be refunded. Therefore if you transfer in from one of these types of schemes you will not be entitled to a refund even if you leave with less than 2 years’ service.
Transferring in: a step-by-step guide
Complete a joiner questionnaire
The process starts by completing and returning a joiner questionnaire. It’s best to do this as soon as possible after joining the scheme as the whole process should be completed within the first 12 months of joining or re-joining the scheme. We’ll acknowledge your initial enquiry and confirm whether or not you’re eligible to transfer.
Obtain your transfer value
The basic requirement of a transfer is to obtain a transfer value of your former pension rights. In some instances we’ll be able to connect with your former pension provider to obtain your transfer value.
Some pension scheme will not provide transfer information to third parties and in these cases we’ll provide you with a transfer pack so you can get the required information directly from your former pension provider. Follow the guidance closely and forward all the information you receive from them to SPPA as quickly as possible.
If you’re transferring from another teaching-related scheme elsewhere in the UK, the process is relatively straightforward. Similarly, other public sector schemes have ‘club’ arrangements that make the process easier.
Once we have a cash valuation, we’ll give you an estimated illustration showing how much extra pension or service your transfer will buy in the Scottish Teachers’ scheme. You should consider taking independent financial advice at this stage.
Decide if you want the transfer to go ahead
When you’ve compared the benefits on offer to those of your old scheme, you’ll need to decide if you want to proceed with the transfer. If you do, you then confirm your request by completing the option forms we’ve provided (and any other forms required by your former scheme).
If you don’t go ahead with your initial request and subsequently make another transfer request, it may not be allowed if it’s outside your initial 12 months’ membership.
When we receive your election for the transfer to go ahead, we’ll request payment from your former provider. When we receive the transfer payment, your pension record will be updated and we’ll confirm the completion.
Your actual membership credit will, of course, depend on the actual transfer payment received from your previous scheme. In some cases, this may differ from estimates provided.
What type of transfer are you making?
Three broad types of transfer can be made into the Scottish Teachers’ scheme and they’re shown below. Bear in mind that you may have pension savings that match more than one description!
Transfers from Teachers’ schemes elsewhere in the UK
Ending of the reciprocal Comparable United Kingdom Schemes arrangements
The former special arrangements between the England & Wales Teachers’ Pension Scheme, the Scottish Teachers’ Superannuation Scheme and the Northern Ireland Teachers’ Pension Scheme have been replaced by new rules that mean that qualifying transfers between Teachers’ pension schemes within the UK are calculated on Public Sector Club terms.
To benefit from the Public Sector Club terms, your former scheme must receive your election to proceed with the transfer within 12 months of you joining the Scottish Teachers’ scheme and the transfer must be completed before your normal pension age.
This is a significant change on the previous rules which were much more flexible on transfers so if you do want to take advantage of a transfer, you should complete the Joiner Questionnaire and return it to us as soon as possible after joining the Scottish Teachers’ scheme.
Transfers from UK Public Sector Pension Schemes
If you’re transferring benefits from other UK public sector pension schemes to the Scottish Teachers’ scheme, you should be able to benefit from preferential terms under the Public Sector Transfer Club. You may also qualify to retain a lower normal pension age.
If your pension from your former scheme has an element of final salary pension and also a career average revalued earnings (CARE) pension, you’ll be transferring two separate pension elements. The CARE element will be transferred into the reciprocal CARE scheme and the final salary element will go into our last open final salary scheme. This may not provide you with the same retirement age or benefit structure you had in your former scheme.
If you want to transfer previous public sector pension rights, complete the relevant section on your Joiner Questionnaire.
If the conditions for the Club transfer are not met, your transfer may still be able to proceed but on less beneficial, non-Club terms as long as you have requested the transfer within 12 months of joining or rejoining. To make sure you benefit from the enhanced Club terms, apply for your transfer as soon as possible after joining the scheme.
In some cases, a transfer between schemes in the Public Sector Transfer Club may result in members exceeding the pension Annual Allowance threshold which, in turn, can attract a tax charge. Although cases are relatively rare, you can check the Annual Allowance rules here.
Transfers from schemes outside the public sector
The Scottish Teachers’ scheme accepts transfers from private personal pensions and pension schemes provided by private sector employers – including defined benefit final salary schemes.
Most private sector pensions tend to be ‘money purchase schemes’ which are invested in a variety of different sources – like stocks and shares, property or cash. With this type of investment, valuations fluctuate frequently and are calculated on a daily basis based on the fund’s value at the date of calculation.
Some occupational pension schemes will guarantee their transfer values for three months. If this is the case, it’s important to deal with the transfer and its associated paperwork as quickly as possible. Delays in processing can lead to the expiry of guarantee dates and that can mean you may have to pay for additional transfer valuations from your former scheme.
Pension credit estimates
Once we receive your transfer valuation, we’ll supply an estimate of the amount of pension credit your transfer value will provide in the Scottish Teachers’ scheme. The estimate will be shown as an additional yearly pension on retirement – rather than a total fund value. The additional pension amount shown on your estimate will also be index-linked to protect you against future inflation.
Additional voluntary contributions (AVCs) and free-standing additional voluntary contributions (FSAVCs)
AVCs and FSAVCs cannot be transferred into the Scottish Teachers’ scheme.
Contacting SPPA Transfers Team
If you’re unable to download the joiner questionnaire, call, email or write to us using the details below.
Telephone: 01896 893000 asking for 'Transfers' when prompted
7 Tweedside Park
If you are contacting us by letter or email please include the following information:
- Date of birth
- National Insurance number
- Superannuation reference number (if applicable)
- Current employer’s details and start date of your current employment.