The retirement process

Deciding to retire can be both exciting and stressful. Knowing the process for receiving your pension and what to expect at each stage can help you feel better prepared.

This step-by-step guide sets out the process for claiming your Buckinghamshire LGPS pension when you leave your job.

View more information about releasing a pension you no longer pay into.

Before you decide to retire, we recommend you get an estimate of how much your pension is likely to be on your expected retirement date.

You can use My Pension Online to run a rough estimate, however, if you are close to retirement, we recommend you contact us to obtain this directly. We can provide up to 2 estimates in any rolling 12-month period.

If you are retiring due to ill-health, redundancy/business efficiency or you are taking flexible retirement, we won’t be able to supply you with an estimate directly, but your employer can request one on your behalf.

We also recommend that you get financial advice where possible. We are unable to provide you with financial advice.

Find out where you can get help with decisions about your pension.

Unless you are retiring due to ill-health, retiring due to redundancy/business efficiency or taking flexible retirement when you hand in your notice, you should tell your employer that you would like to receive payment of your LGPS pension when you leave.

You can contact us to let us know if you wish to, but this is not essential. Your employer will notify us and provide us with information to calculate your pension.

If you have a separate deferred pension account that you wish to release at the same time, you will need to notify us directly at least 3 months before your retirement date.

To calculate your pension and provide you with your options, your employer must provide us with:

• your pay information
• your retirement details
• additional documentation in the case of flexible, redundancy and ill-health retirement

We won’t be able to provide you with a retirement pack until this is supplied to us in full. This usually won’t be provided to us until quite close to your retirement date. Some employers will not have access to the information until your final month’s pay has been processed.

Once we receive this information, we will check to ensure the paperwork appears to be complete and accurate. Our priority is always to ensure your pension is calculated correctly. If we believe something is incorrect or missing, we will go back to your employer to request further information. We appreciate your patience during this time.

If you would like to know when this information will be forwarded to us, contact your employer. Find out more about calculating your pension.

If you paid in before 1 April 2014, we will send you a letter asking you if you think you qualify for final pay protection. If you think you do, you must let us know as soon as possible by the deadline provided in the letter.

We aim to calculate your pension within 5 working days of receiving accurate and complete information from your employer.

Once we have calculated your pension, we will upload your retirement pack to My Pension Online. If we have your email address, we will email you to let you know it is ready. If you haven’t yet registered for, My Pension Online, we recommend you do this in advance so you can receive notification as soon as your retirement pack is ready.

If you have opted out of My Pension Online, your retirement pack will be posted to you. Allow 5-7 working days for delivery.

Included in the retirement pack will be:

• a letter setting out your payment options
• pension estimates
• useful information about receiving an LGPS pension
• a set of retirement forms

If you have requested to receive payment for more than one pension account, you will receive a separate retirement pack for each.

You will need to complete and return your forms to us as soon as possible. You will also need to provide us with a copy of a date of birth verification, as well as evidence of a name change if the date of birth verification is held in a different name to the one we hold for you. All of your documents can be returned to us via ‘my pension online’.

For audit and legal reasons, we won’t be able to process your forms unless they are completed correctly. If you need any assistance in completing the forms, or you have any questions, contact us before you complete your forms. If we receive forms that are not completed correctly, we will be unable to process your pension. This could delay payment.

Find out more about the decisions you will need to make about your pension.

If you have paid towards AVCs (Additional Voluntary Contributions), you will also need to decide what you would like to do with them when you retire.

In addition to the retirement pack, you will receive a separate AVC options letter. You will need to look at these options in conjunction with your retirement pack and return AVC forms at the same time as your retirement forms.

Find out more about what you may be able to do with your AVCs at retirement.

If you are currently paying towards AVCs, you should decide whether or not you wish to pay the AVC contribution from your final month’s pay. If you do, you should note that there will be a considerable delay in paying pension benefits from your AVC Fund.

This is because your employer must pay your AVC contributions over to the AVC provider by the 19th of the following month that AVC contributions are deducted. Your AVC Fund cannot be released before your final contribution has been received and processed.

If you do decide to stop paying your AVC contributions before your retirement month, you must advise us and your employer in writing well in advance. If we do not receive advance written notification that you are stopping AVC contributions prior to your retirement date, we will assume that you are continuing to pay your AVCs to your last working day.

You may wish to get financial advice before you make a decision about ceasing AVC contributions.

Once we receive your forms we will:

• check to ensure they are fully complete
• check your date of birth verification
• calculate your final pension details

If anything is incorrect we will contact you to advise you of this and we will ask you to complete a new form(s) if necessary.

Once we have everything we need to pay your pension benefits a letter will be issued to you via My Pension Online confirming:

• your final pension amount(s)
• the date you will receive payment
• the lifetime allowance percentage

We won’t make payment of any pension benefits to you until after your retirement date.

Once we have everything we need and the retirement date has passed, if you are due to receive a lump sum we aim to pay this to you on the next available payment date.

We have certain days set aside each month to make lump sum payments. We aim to pay your lump sum within 10 working days of processing your retirement.

We will always do our best to pay your first instalment of annual pension on the last working day of the month after your retirement date.

For example, if you retire on 1 November, we aim to pay your first instalment of annual pension on the last working day of November. However, if your retirement date is close to the last working day of the month, this may not be possible.

This is because we will run the payroll the week before payment, and we need time to check through the information you send to us and perform a final calculation of pension amounts.

If we pass the last working day of the month after your retirement date, we will pay any arrears to you at the next available payment date. Your confirmation letter verifies the date your pension will be paid.

Any lump sum you receive is tax free, but your annual pension is counted as earned income for tax purposes. If you have your P45 available, you will need to forward this to us. You will pay income tax on your pension if you exceed your personal allowance.

Tax codes are supplied to us by Her Majesty’s Revenue and Customs (HMRC), which we then apply to your pension, we have no discretion about the amount of tax deducted.

All tax-related queries should be directed to HMRC. Contact details and more information about tax is available at: www.gov.uk/tax-codes.

We want to do everything we can to make retiring and receiving your LGPS pension as simple as possible for you.

If you need any assistance or want to check up on the progress of your retirement, contact us.