Hi,

Sorry if this has been brought up before, I have had a look around and can't find anything on it anywhere. After injury I have recently been informed by the Armed Forces Compensation Scheme that I will receive a tax free GIP (Guaranteed Income Payment) from the day I leave the service. I am not being MD'd or anything at present and still have three years left to serve. My problem is that I do not understand how the GIP works in connection with AFPS75 which I am currently on. Does anyone know if the GIP (which will pay more that my AFPS75) will cancel out my entitlement to my AFPS75 pension, or is the AFPS75 pension somewhet reduced???

Many thanks!

Originally Posted by oxygna3

Hi,

Sorry if this has been brought up before, I have had a look around and can't find anything on it anywhere. After injury I have recently been informed by the Armed Forces Compensation Scheme that I will receive a tax free GIP (Guaranteed Income Payment) from the day I leave the service. I am not being MD'd or anything at present and still have three years left to serve. My problem is that I do not understand how the GIP works in connection with AFPS75 which I am currently on. Does anyone know if the GIP (which will pay more that my AFPS75) will cancel out my entitlement to my AFPS75 pension, or is the AFPS75 pension somewhet reduced???

Many thanks!

The award of a GIP is separate from the AFPS pension you are entitled to. The GIP takes into account the impact of your condition on future income and will take into account the amount you are getting by way of occupational pension. Further help on AFCS benefits can be obtained from the SPVA website and help in determining/securing what you are due may be sought from the Royal British Legion.

Thanks for your reply, I've been trying to find out by looking on the AFCS site but it looks like the GIP is abbated by 75% when in reciept of a full pension. Any ideas on this / am I getting it wrong?

Your GIP is abated by the pension amount. So if your GIP is £20000 and pension £10000 you will receive £10000 GIP, £10000 pension.

Apparently this is because you cannot be compensated twice for the same injury or condition.

But since when has a pension been compensation? The MoD may have a point for those who have not completed 22 years, but subsequently receive an immediate pension on medical discharge.

However for those of us who have or will complete 22 years then we've worked for nothing and the MoD misses the point that we would, if fully fit, have the potential to earn the sum the GIP compensates us for IN ADDITION to the service pension.

No one can give me a straight answer on the final lump sum and commutation all with regards to AFCS and GIP.

Dingerr, unless I'm mistaken, and SPVA Glasgow have got it wrong, if you are medically discharged there is no commutation.

Originally Posted by EScotia

Dingerr, unless I'm mistaken, and SPVA Glasgow have got it wrong, if you are medically discharged there is no commutation.

EScotia is 100% correct. If your MD then when completing your PEN 1 you have to ensure that you tick the box for non commutation.

Originally Posted by dingerr

Your GIP is abated by the pension amount. So if your GIP is £20000 and pension £10000 you will receive £10000 GIP, £10000 pension.

Apparently this is because you cannot be compensated twice for the same injury or condition.

But since when has a pension been compensation? The MoD may have a point for those who have not completed 22 years, but subsequently receive an immediate pension on medical discharge.

However for those of us who have or will complete 22 years then we've worked for nothing and the MoD misses the point that we would, if fully fit, have the potential to earn the sum the GIP compensates us for IN ADDITION to the service pension.

No one can give me a straight answer on the final lump sum and commutation all with regards to AFCS and GIP.

Dinger, From what I can dig up on this you're absoloutley right - and what was confusing me was the wording that you can't be compensated for the same injury twice! So that would indicate that the goal posts for a 22yr pension shift from being for serviceserved, to being compensation for injuries sustained.

In my circumstances the GIP when reduced by 75% against my service pension makes a difference of a few pence. Therefore, I can either hang in another 3 yers for a lump sum and the same pension (which may actually end up less if it's taxed - which is another point I am unclear on)).

Here's a link to the AFCS Booklet which explains it but I found it slightly confusing, especially when it perceives a 22yr pension as compensation. Have a look at p.15 where it explains that the GIP is reduced by 75% against an Immediate Pension (IP). However, immediate pensions are taxable, which as I mentioned earlier, may result in actually receiving less that if you were only on the GIP.

http://www.mod.uk/NR/rdonlyres/526B6...cs_booklet.pdf

Originally Posted by EScotia

Dingerr, unless I'm mistaken, and SPVA Glasgow have got it wrong, if you are medically discharged there is no commutation.

Do you receive the final lump sum, but just not allowed to commute it?

This is ridiculous. Once I have served my 22 years I should be entitled to the same conditions as everyone else with regards to pension.

It seems like although I will receive GIP I will effect have to give up a full pension for the privilege.

Dinger,

refs your previous post, that's what's been confusing me. Below is a link to the AFCS booklet. Have a look at P15. It states as you said - that the GIP is reduced by 75% of the amount of the Immediate Pension (IP). It then says that it is because you can't be compensated for the same injury twice, which again as you said, would indicate that the goalposts of our 22yr pensions shift from being for time/full career served to compensation. Therefore, it all looks a bit buttered up to be honest.

In my case the difference between the GIP and the IP pension is minimal and makes a difference of pennies at the end. Therefore, if it's the GIP which gets reduced by 75% of the IP, that would indicate that I'd recieve 25 GIP and 75% Taxable IP which which would actually mean I'd get less!!! Surely that can't be right??? If so, that would mean that if I decided to leave tomorrow, I'd be on more money (tax free) and only be less the lump sum!

http://www.mod.uk/NR/rdonlyres/526B6...cs_booklet.pdf

(tried to post this twice already but it hasn't shown up yet - maybe because I tried to post a lonk on it?)

Dinger,

refs your previous post, that's what's been confusing me. Google the AFCS booklet pdf and have a look at P15. It states as you said - that the GIP is reduced by 75% of the amount of the Immediate Pension (IP). It then says that it is because you can't be compensated for the same injury twice, which again as you said, would indicate that the goalposts of our 22yr pensions shift from being for time/full career served to compensation. Therefore, it all looks a bit buttered up to be honest.

In my case the difference between the GIP and the IP pension is minimal and makes a difference of pennies at the end. Therefore, if it's the GIP which gets reduced by 75% of the IP, that would indicate that I'd recieve 25 GIP and 75% Taxable IP which which would actually mean I'd get less!!! Surely that can't be right??? If so, that would mean that if I decided to leave tomorrow, I'd be on more money (tax free) and only be less the lump sum!