RHM Pension Plan 35 and Plan 45 - RHM Pension Scheme - UK.com

Tax-free cash sum
Cash sum
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At retirement, you will normally be able to exchange part of your pension for a cash sum which, under current
legislation, is tax-free. Your pension will be reduced accordingly.
Surrendering part of your pension for cash in this way will not reduce the size of your dependant’s pension, which
will be calculated on the amount of your full pension as though you had not chosen to exchange part of it for
cash.
As an indication of how the cash
sum option works, many members
will be able to take cash based on the
following formula:
3/80ths of your Final
Pensionable Earnings
for each year of continuous service
with an RHM company
Note: For the purposes of calculating the
tax-free cash sum under this formula,
your Final Pensionable Earnings will
not be reduced for the Lower Earnings
Limit, even if you have chosen the “LEL
definition” of Pensionable Earnings.
The amount of cash you can take
may also be limited by Inland
Revenue rules. You will be advised
at the time of your retirement
whether the amount of cash you can
receive is restricted by the rules.
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Reduced pension
The annual pension you give up in
return for cash depends on your age
at retirement. The rates which apply
to both men and women are
illustrated below:
Age at
retirement
Cash sum obtained
for each £1 of
pension given up
65 £9.00
64 £9.40
63 £9.80
62 £10.20
61 £10.60
60 £11.00
Below 60 £11.00 plus
24 pence for
each year below 60
The Trustees reserve the right to
amend these rates from time to time
based on the advice of the actuary.