Concurrent pensions

You may be able to make your own arrangements to pay into a personal pension plan or stakeholder pension scheme (defined contribution schemes) at the same time as paying into the Scheme (defined benefit scheme).  You choose the provider which is usually an insurance company. You may also want to consider their charges, alternative investments and past performance.

You choose how much to pay into the arrangement. You can pay up to 100% of your total taxable earnings in any one tax year (or £3,600 if greater) into any number of concurrent arrangements and be eligible for tax relief on those contributions.

The contributions which you pay into a personal pension plan or stakeholder scheme are invested in funds managed by an insurance company. You have your own personal account that, over time, builds up with your contributions and investment returns, and will be available at retirement to convert into additional benefits.

From 6 April 2015 members of defined contribution pension schemes will have more freedom on how they take their money from their pension pot.

There will be four main options for members contributing to defined contribution schemes which offer flexible benefits at retirement:

  • Buy an annuity (annual pension)
  • Flexi-access drawdown
  • Take a number of cash sums at different stages
  • Take the entire pot as cash in one go

More information on the variety of options available when drawing benefits from a stakeholder pension scheme or personal pension scheme is on the government’s guidance website – Pension Wise – a service from MoneyHelper.  This website provides information on drawing flexible benefits only and does not apply to drawing benefits from the Scheme. 

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