Terminal Grant and Pension

Discussion in 'Armed Forces Pension Scheme' started by crazymab, Sep 4, 2007.

Welcome to the Army Rumour Service, ARRSE

The UK's largest and busiest UNofficial military website.

The heart of the site is the forum area, including:

  1. I read something on part one orders today and am hoping someone can shed some more light on the matter. Basically it said that the allowing of commuting up to 50% of your pension is to change as of next year to a maximum of 25%. It also says that this will be reflected in the pension calculations soon. Is this correct or am i reading it wrongly, if so this has got an amazing impact on my plans for getting out of the green stuff and settling to civvy steet. can anyone help?
  2. You are indeed correct, once again we have been buggered by the Govt.
  3. Booklet AFPS 75 explains it clearly. This can be found on ArmyNet. It's not quite as bleak as it first seems, but yet again we have not been correctly informed of this change!!
  4. When you use the Pensions calc it gives you the following message;

    Note: The forecast has calculated a maximum of 50% commutation for all service, however, for service after 6 April 2006 only 25% can be commuted. The calculator will be updated but in the meantime if you require an accurate forecast including resettlement commutation please contact JPAC at JPAC@spva.mod.uk.

    Is this not a change in terms of service? Surely that cannot be done without consent? Looks to me as if it is.

  5. MMMmmm, would that be people joining after then or people leaving?

    I suspect the latter but can any gurus confirm?
  6. Is this retrospective for those who signed up under the old terms and conditions of service? If it is, then it would be grossly unfair but the statements about AFPS 75 and AFPS 05 on the Veterans Agency website would indicate otherwise. Can anyone clarify?

    The new regs appear to conform with recent civvy pension legislation and this is not all bad news for those who serve a longer career. Having paid a proportion of my pre-JPA RN SSP (Special Service Pay) into a FSAVC (Free-Standing Additional Voluntary Contributions) pension scheme with maximum tax rebate for several years while serving, the new laws enabled me to draw 25% of my FSAVC pension pot as a lump sum at the age of 55 and to choose my own annuity provider. If I wanted, I could have transferred the pot to another pension scheme or deferred payment of my annuity up to the age of 75 while leaving the pot to grow. Few of these options would have been available to me a couple of years ago.

    The straight service pension has always been a good deal but more flexibility, such as the option to transfer it to another scheme on release, would be no bad thing. Anyway, watch out when you go outside as it can be a minefield. Seek the advice of the White Ensign Association if RN/RM, the Veterans Agency or an IFA (Independent Financial Adviser) before making any important decisions but be aware that many of the latter are unfamiliar with the Armed Forces Pension Schemes.
  7. Would like to think it would depend on whether you changed onto the new pension scheme or not.

    Escape plan may need to be reassesed if not.
  8. Its not about terms of service - this rule applies to pension funds hosted in the UK whether you are military or civilian.


    The finance act 2004 has made these changes. The din does say that these changes do not affect your choice to stay or transfer from AFPS75. Aparantly the changes happened after the OTT process, but as far as i'm aware i signed my OTT in 2005, the year after the Finance Act. The first i heard about commutation changes was when i saw the DIN about 2 weeks ago. Something doesnt quite add up (not least my commutation)!
  9. Was on a resettlement finance brief yesterday - financial advisor mentioned this.
    He said it dropped from 50% to 25% from 2006 - but only years served from 2006 will be affected (years served before 06 then you still qualify for 50%) - so for someone with a runout date in the next year or 2 - the impact will be a couple of hundred quid less able to commute.
    Still, sneaky little change - buried this info since 2006 didnt they!!
  10. Phew!!!! I'm alright jack :)
  11. I think I might just change my terms of service, seeing how the Gov keeps changing mine. Can I opt out of Afghan next year?

    PS - If anyone from the Gov is reading this, any chance you can sort out the 5 months of wages disruption as well. Bunch of cnuts
    SCHEME 1975 (AFPS 75) ONLY
    A. 2007 DIN01-018.
    1. Reference A details the changes to resettlement commutation. For service after 6
    Apr 06 an individual can commute up to a maximum of 25% of their immediate
    pension entitlement (inclusive of the proportion of Terminal Grant accrued after 6 Apr 06).
    Rules for service prior to 6 Apr 06 are unchanged; an individual can commute up to a
    maximum of 50% of that immediate pension entitlement, excluding the Terminal Grant.
    2. These changes have been enacted under the Finance Act 2004 and are not MOD
    policy changes. The Pensions Calculator will be amended in due course to reflect these
    Issue 08/07 DSPS(A)163/100/SA Pens and Svc Funds
  13. So has the pension calculator been "updated" ? I havent checked it for a while, and being the sad git I am, had worked out to the last penny what i was going to do with it. Now it looks like I will have to go back to my IFA and do it all again, and let's be honest I can think of better things to do with my time, like watch paint dry or work out when the UNICOM Central Server will become live :oops:
  14. They do this because soldiers cant complain. They just publish it on P10s and say 'thats it - abide by it' Makes me friggin furious
  15. You saw this bit then?