You can add value to your Teachers’ pension by transferring former pension rights

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

1. 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.

2. 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.

3. Compare benefits

   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.

4. 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.

5. Await confirmation

   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!