Planning Your Retirement - THE LOCAL GOVERNMENT PENSION ...

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HM Revenue and Customscontrols and your<strong>Retirement</strong> BenefitsFrom 6 April 2006 HM Revenueand Customs introduced controlson the pension savings youcan have before you becomesubject to a tax charge.The Lifetime Allowance is the totalcapital value (see page 13) of allyour pension arrangements, but notyour state pension, which you canbuild up without paying extra tax.If the value of your benefits whenyou draw them (not includingany State <strong>Retirement</strong> Pension,State Pension Credit or anyspouse’s, civil partner’s, cohabitingpartner’s or dependant’s pensionyou may be entitled to) exceed yourLifetime Allowance, a tax chargewill be made against the excess.The Lifetime Allowance forcurrent and future years2011/2012 £1.80 million2012/2013 £1.50 million2013/2014 £1.50 millionThere are protections for benefitsearned up to 5 April 2006 in respectof those high earners affected bythe introduction of the LifetimeAllowance from 6 April 2006.You can find out more aboutthese in our factsheet, Tax andyour Benefits’. You can requesta copy on 0151 242 1360 ordownload a copy from our websiteat www.tinyurl.com/cph4v25.The Fund will let you know thevalue of your LGPS benefits onretirement and ask you aboutany other pensions you mayhave in payment, so we canwork out whether we need todeduct a recovery tax charge.If you do not provide this33
information promptly it could delaythe payment of your pension.Also, under HM Revenue andCustoms rules, if the LGPS makesan unauthorised payment or ifyou recycle your lump sum backinto a pension arrangement,there will be a tax charge.The Annual Allowance is a limitthat applies to the increase inpension benefits from one year tothe next. However, in April 2011,the previous limit of £255,000was reduced to £50,000.This could therefore affectnot just the highest earners,but members who either;• have long membership andsubsequently gain a significantpromotion, and/orHow is the increase inthe value of benefitscalculated?The increase in the value ofbenefits is calculated by deductingthe value of all occupational andpersonal pensions in a previousyear, adjusted for inflation,from the value of all occupationaland personal pensions in thefollowing year, then multiplyingthe difference by 16. Add this tothe increase in the value of anylump sums, including inflation,plus any increase in any AVC funds,then gives the total increase.Unused annual allowance canbe carried forward from theprevious three tax years.• transfer in a sizeable amountof previous pension rights.34
Page 1: Planning Your RetirementThe Local G
Page 4 and 5: Introduction
Page 6 and 7: Planning YourRetirement
Page 8 and 9: LGPSRetirementBenefitsYour LGPS ret
Page 10 and 11: Final PayThe other important elemen
Page 12 and 13: If you work Whole-Time: On retiring
Page 14 and 15: Options onRetirementTaking a bigger
Page 16 and 17: If you are buying extraLGPS pension
Page 18 and 19: Increasesto YourPensionYour LGPS pe
Page 20 and 21: Your StatePensionIn addition to you
Page 22 and 23: Can I retire early?If you have at l
Page 24: If you choose to retire before age6
Page 27 and 28: EarlyRetirementthroughRedundancyor
Page 29 and 30: Ill HealthRetirementWhat happens if
Page 31 and 32: Examples of calculating increased m
Page 33: TaxMatters
Page 37 and 38: Income Tax andyour PensionYour LGPS
Page 39 and 40: How yourRetirementBenefits willbe P
Page 41 and 42: Protectionfor yourFamilyWhat benefi
Page 43 and 44: Help withPensionProblemsIf you are
Page 45 and 46: GlossaryAdditional VoluntaryContrib
Page 47: Consumer Prices IndexThis shows the
Page 50: London Road be ready to turn righta

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