Transferring your benefits out of the Scottish Teachers’ scheme
Warning: Beware of ‘pension liberation’ scams
Before making a pension transfer, it’s worth reading the information provided by the Pensions Regulator on ‘pension liberation’ scams to ensure you don’t get targeted by a fraudulent schemes.
What is a pension transfer?
If you’re either leaving your teaching post in Scotland (or you’re choosing to leave your Scottish Teachers’ pension scheme) you can transfer the value of your accumulated pension benefits to a different approved pension scheme.
For example, if you’re moving to a teaching post in England & Wales or Northern Ireland, you could request a transfer to your new employer’s scheme. Please note that this type of transfer is no longer done on a ‘like-for-like’ basis.
Transfers out can also be made to a registered occupational pension scheme with defined benefits, but cannot be made to defined contribution schemes offering flexible benefits (unless you have between three months and two years’ membership in the scheme, and don't currently qualify for a pension in retirement).
Transferring to a Recognised Overseas Pension Scheme
The transfers team at SPPA can tell you if it’s possible to transfer benefits to a Recognised Overseas Pension Scheme – although overseas transfers are rare these days and may be subject to a tax charge. Please email email@example.com with the name and type of pension scheme you want to transfer to. Further information on overseas transfers is available here.
Transfer time limits
Once you have over two years’ service, you can apply for a transfer at any time but it must be completed before your normal pension age (NPA).
If you have less than two calendar years’ service you have to apply for a transfer within 12 months of joining your new scheme.
Members of the 1997 section, with a normal pension age of 60, must complete their transfer before reaching age 60.
Members of the 2007 section, with a normal pension age of 65, must complete their transfer before reaching age 65.
If you’re a member of the 2015 scheme, or have transitioned to it, you have to apply before your state pension age.
Cancelling a transfer
Once a payment has been sent to your new scheme, the transfer can’t be reversed. If you change your mind after starting a transfer, contact SPPA immediately.
Transferring out FAQs
How do I apply for a transfer?
Before asking for a transfer, you need to check your new provider’s transfer process and see if they’re willing to accept a transfer from the Teachers’ Pension scheme. We normally get the transfer request directly from your new provider, though we can take a transfer request directly from you if your new provider won’t ask for transfer details on your behalf. Once we have your application, we’ll confirm that the receiving scheme is eligible and provide a transfer value as quickly as possible.
I’ve applied for a transfer, what happens next?
We’ll calculate your transfer value and guarantee it for three months. It will be supplied to your new pension provider along with the necessary discharge forms. Your new provider should then tell you what benefits your transfer value would buy in their scheme. You should then compare the benefits offered by your new provider against those preserved for you in the Teachers’ scheme. Take care to compare the normal retirement age in your new scheme with what you’d expect in your current Teachers’ scheme. It’s quite common for the normal retirement age to change as a result of a transfer. If you do decide to go ahead with the transfer once you’ve compared the schemes, you’ll have to sign the discharge forms so they can request the transfer on your behalf.
How is the transfer value calculated?
We use a range of factors supplied by the Government Actuary’s Department to calculate a transfer value. The calculation converts the value of your accrued pension rights into a cash equivalent which is then used to buy in to your new scheme.
Is the transfer value guaranteed?
Transfer values are guaranteed for three months from the date of calculation. If we receive a request for payment within the three month guarantee period, we’ll pay the guaranteed amount. If the request arrives after the three month guaranteed period, the transfer value will have to be recalculated before being paid to your new scheme.
Do I have to pay for the transfer valuation?
All scheme members can have one transfer valuation a year free of charge. If you need more than one valuation, you’ll have to pay a fee.
Are the Teachers’ Pension Schemes members of the ‘Public Service Transfer Club Scheme’ arrangements?
Yes they are and there’s more information about the club schemes here.
Are you able to advise me if transferring is my best option?
SPPA doesn’t provide financial advice. We always recommend that members get independent financial advice before deciding whether to transfer benefits to another pension scheme.
What happens to my normal retirement age after a transfer?
When you transfer to another occupational pension scheme, it’s highly likely your normal retirement age will increase. You should make a point of comparing your normal retirement age in the Teachers’ scheme (which is shown clearly on the transfer options forms) with the retirement age detailed in your new provider’s scheme.
More information about the Pension Schemes Bill can be found here.
Contact the SPPA Transfers Team
Scottish Public Pensions Agency
7 Tweedside Park
Telephone: 01896 893 000 and ask for Transfers when prompted.