Notes for your annual benefit statement 2022

Personal information

This section contains information about your membership in the Local Government Pension Scheme (the Scheme) including your current employer, which section of the Scheme you are in and your membership number. If you have more than one membership with the Tyne and Wear Pension Fund (TWPF), your membership ID number will be used to identify which statement is for which post.

Your Standard Benefits at March 2022

This is an estimate of the values of your benefits at 31 March 2022. Any actual final salary benefits (pre 2014 element of your pension benefits) will be based on final pay on leaving the Scheme and could be higher or lower than those quoted. We have used your final salary at 31 March 2022 for the purposes of the Statement. Final salary benefits will only be shown for a member who joined the Scheme before 1 April 2014 or has completed a transfer from a qualifying Scheme and all or part of the transfer value bought final salary membership in the Scheme. Member CARE benefits (post 2014 element of your pension benefits) include revaluation up to the previous 1 April only.

A transfer of previous pension rights will be reflected in your figures only if it was completed by 31 March 2022. A transfer completed after this date will be included in your statement next year.

The figures have been adjusted to take account of any reductions due to a pension sharing order and/or an annual allowance scheme pays debit.

Members must have 2 years Scheme membership to qualify for a pension unless you have transferred in from another pension provider. Benefits at 31 March 2022 are provided for information only. If you leave with less than two years' membership, you will not qualify for benefits and will generally be able to opt for a refund of contributions.

Projected value of Standard Benefits

This shows your projected benefits at your normal pension age (NPA). This date is the same as your State Pension Age (SPA). Your NPA may change in the future if the Government changes State Pension ages. If you are over age 55, the current rules allow you to retire before your NPA. A reduction to your pension benefits will apply if the benefits are taken before NPA. This is not reflected in your statement. You can also choose to retire after NPA and your pension benefits would include late retirement increases. You must receive payment of your benefits before age 75. If you are over NPA at your statement date, we cannot project your pension benefits as we do not know your intended retirement date. You can use the online pension calculator in your mypension account to calculate your own estimates which will give you an idea of how much you will receive at your preferred retirement date.

The projection is based on the section of the Scheme you were in on 31 March and the assumption that your pay will remain constant to their NPA. No account has been taken of future wage inflation or future pensions increases. If you were on reduced contractual pay or no pay due to sickness or relevant child related leave for any part of the year ending 31 March, Assumed Pensionable Pay (APP see Note 1) has been included in the pensionable pay figure for that period.

Note 1 - APP is a notional pay figure that means your pension is not affected if your pay is reduced when you are absent. Your pension will be based on Assumed Pensionable Pay during a period of reserve forces leave, relevant child related leave and when your pay is reduced because of sickness or injury.

A late retirement increase has been applied to any projected final salary benefits where your NPA is over 65. The late retirement increase is based on the current rules, which may be different when you take your benefits.

The figures have been adjusted to take account of any reduction due to a pension sharing order and/or an annual allowance scheme pays debit. The pension sharing debit / annual allowance scheme pays debit has been based on the assumption that you retire at your NPA. The debit will be adjusted if you retire at an earlier or later date to account for the longer or shorter recovery period.

Exchanging pension for lump sum

The Scheme allows you to increase your lump sum by reducing your annual pension. Assuming everything remains the same, the Statement shows an estimated projected maximum lump sum you could receive at NPA. It also shows the reduced pension amount. These values are subject to HMRC's tax limits.

Death benefits

If you die when you are still paying into the Scheme, a lump sum death grant of three times your annual rate of APP (see note 1 on page 1) is paid. It does not matter how long you have been a member of the Scheme, provided you are under age 75 at the date of death.

However, if you also have a deferred benefit and/or a pension in payment from a previous period of membership of the Scheme, the lump sum death grant paid is the greater of:

• the total of any lump sum death grants payable from the deferred and/or pensions in payment
• three times your assumed pensionable pay at the date you die

The Tyne and Wear Pension Fund makes the final decision on who will receive any death grant. If you have made a 'Death Grant Nomination' we will take into account your wishes. If you have not yet made a nomination, you can do so in your mypension account. Please make sure that this information is kept up to date.

Survivor benefits

Any survivor final salary benefits quoted are based on current pay and no pay inflation has been assumed.  Survivor CARE benefits include increases up to the previous 1 April only. If you are single, there will be no survivor pension (other than to an eligible child) payable if you are not survived by an eligible cohabiting partner.

The total survivor pension is made up of:

• the final salary survivor pension accrued up to 31 March 2014 (if applicable) including any purchased added years or additional regular contributions that include a survivor's benefit.
• and the survivor benefits due under the CARE Scheme from 1 April 2014 (if you remain an active member until your NPA and your CARE pensionable pay remains constant).

The annual survivor pension will include the CARE enhancement:

• APP x 1/160^th x membership from 1 April 2014 to your NPA

The survivor benefit payable to your surviving spouse or civil partner is based on all Scheme membership, however the survivor benefit payable to:

• an eligible cohabiting partner will not include any membership before 6 April 1988 (unless you made an election before 1 April 2014 to pay for some or all of that membership to count
• a widow of a male member who married after leaving the Scheme, a survivor of a same sex marriage if the marriage occurred after leaving, or a civil partner of a post leaving civil partnership will not include any pre-6 April 1978 membership
• a widower of a female member who married after leaving will not include any pre-6 April 1988 membership

An eligible cohabiting partner is a partner you are living with who, at the date of your death, has met all of these conditions for a continuous period of at least two years:

• you and your cohabiting partner are, and have been, free to marry each other or enter into a civil partnership with each other, and
• you and your cohabiting partner have been living together as if you were a married couple or civil partners, and
• neither you nor your cohabiting partner has been living with someone else as if you / they were a married couple or civil partners, and
• either your cohabiting partner is and has been dependent on you, or you are and have been financially interdependent on each other.

A childs pension may also be payable in the event of your death providing they are your child, an adopted child, a stepchild or a child accepted by the deceased member as a member of the family who was dependent on the member at the date of death.

An eligible child must also be:

• under age 18, or
• aged under 23 and in full-time education or vocation training. Your pension fund can continue to treat a child as an eligible child even of there has been a break in full-time or vocational training, or
• under age 23 and unable to engage in gainful employment because of physical or mental impairment, or
• over age 23, unable to engage in gainful employment because of permanent physical or mental impairment and the child was dependent on the member at the date of death because of that impairment. An independent registered medical practitioner must give their opinion on whether the impairment is likely to be permanent.

Tax controls and your pensions

HMRC set certain limits on the total amount of contributions you can make into all pension arrangements and receive tax relief on, and on the pension savings you can have before you become subject to a tax charge.

The values shown on your Statement are for that membership in the Tyne and Wear Pension Fund only. It is your responsibility to check your tax position.

Annual Allowance - The annual allowance is the amount your pension savings can increase by in a year without you having to pay extra tax. If your savings increase by more than the annual allowance, you will have to pay tax on the excess. The standard annual allowance is currently £40,000.

The pension input amount (PIA) on your statement used for annual allowance (AA) is estimated. If you have breached the AA limits, we will provide a Pension Saving Statement (PSS) by 6 October 2022. If you require a PSS, you can request one from us. For more information on AA please visit GOV.UK: Tax on your private pension contributions.

Lifetime Allowance - The lifetime allowance is the total value of all pension benefits you can have without having to pay extra tax. 

The lifetime allowance (LTA) figures quoted on your statement are estimated only and do not take into account any protections you may have in place. For more information on LTA, please visit GOV.UK: Tax on your private pension contributions.

Need further information about the LGPS?

The Tyne and Wear Pension Fund has its own website for members and can be found at www.twpf.info .

The LGPS has a national website and can be found at LGPS member.