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Personal Benefit Guidance Notes 2025

Your 2025 Pension Benefit Statement has been split into six sections:

Section one: Personal Details – these have been supplied to us by your employer, if any of these details are incorrect, please inform your employer/ payroll department. You can change some of these details with ourselves via our online portal Member Self Service (MSS) Engage.

Section two: Summary of total benefits – this includes your accrued total pension benefits as of 31 March 2025, and any death in service benefits that would be payable. You can view the full breakdown / split of these figures under sections three and four, depending on the dates that you have been paying into the LGPS.

Section two also highlights your nomination details which you should review and update accordingly.  You can also update these by using the online portal MSS Engage. 

Section three: CARE (Career Average Revalued Earnings) Benefits – this includes the CARE pension benefits that you have built up as at 31 March 2025, please see below ‘CARE (Career Average Revalued Earnings) Pensionable Pay’ for more information on this.

Section four: Final Salary Benefits – this includes the final salary benefits only (if any) that you have built up as at 31 March 2025, please see below ‘Final Salary Pensionable Pay’ for more information on this.

Section five: Projections – this includes the potential pension benefits you would receive if you remained contributing to the LGPS up until your state pension age. The figures therefore do not factor any actuarial reductions for if you were to retire earlier than this date. You can however view different potential retirement dates using the online portal MSS Engage.

Section six: Your membership details – this details your service history within the scheme, if you believe any of these details are incorrect or have other LGPS service that is not shown, please contact us via the MSS Engage online portal or by calling our Member Support Team.

  • How we calculate your Pension Benefits

    You need two years scheme membership to qualify for a pension in the LGPS, unless you have completed a transfer of pension benefits.

    For membership built up to 31 March 2008: You receive a pension of 1/80th of your final salary pensionable pay, plus – under current legislation – an automatic tax-free lump sum of three times your pension.

    For membership built up from 1 April 2008 to 31 March 2014: You will receive a pension of 1/60th of your final salary pensionable pay.

    If you joined the scheme for the first time on or after 1 April 2008 then you are not automatically paid a lump sum. However, at retirement all scheme members have the choice of giving up part of their pension and converting this into a lump sum. The current rate of conversion is £12 lump sum for £1 of annual pension, subject to certain restrictions (we are able to provide you with full details when you retire). You can view the maximum lump sum and other options available to you on our online Member Self Service (MSS) Engage portal.

    For membership built up from 1 April 2014 (Career Average Revalued Earnings – CARE). CARE replaced the Final Salary scheme in 2014. Under the new scheme:

    • every year you build up a pension at a rate of 1/49th of the amount of the pensionable pay you received in that scheme year (if you are in the main section of the scheme), or
    • every year you build up a pension at a rate equal to 1/98th for any period you have elected to be in the 50/50 section of the scheme. This pension is then added to your pension account and revalued at the end of each scheme year.

    Your post-2014 pension is revalued in line with HM Treasury Revaluation Orders which currently use the rate of the Consumer Prices Index (CPI), which can go down as well as up.

    The projected benefits at Normal Pension Age are based on your pensionable pay for the year ending 31 March 2025. These projections assume your pay will remain constant and do not include any future revaluation of benefits built up in the CARE scheme.

    Your projected CARE benefits will include the full amount of any Additional Pension or Shared Cost Additional Pension you purchased.

    Any deductions due to Scheme Pays for Annual Allowance tax, or any Pension Sharing Order as a result of divorce will be detailed. The projection of benefits is also based on the section of the scheme you were in as at 31 March 2025.

  • Service History

    It is up to your employer to tell us about any changes in your employment – if you reduce or increase the number of hours you work, for example. If you believe any of these details are incorrect, please ask your employer to check them and let us know about any changes. This section also shows any pension membership that you have transferred into the scheme from another pension provider. These transfers do not generally provide the same amount of membership as you had in the original scheme.

  • Partnership Status

    We have used the partnership status that we hold on your record. Where this is not known we have assumed you are married, so that we can include the amount of a survivor’s pension for your information. If you were married as at 31 March 2025 the survivor’s pension payable to a surviving spouse or civil partner is based on all of your service. If you were single as at 31 March 2025 there is no survivor’s pension (other than to eligible children). If you are in an eligible cohabiting partnership, the benefits payable to the partner may be less than those shown.

    Post-Retirement Marriages

    Please note that partner benefits will differ where a post-retirement marriage/civil partnership occurs. A pension for a widow of a post-retirement marriage will not include any pre – 6 April 1978 membership. A pension for a widower of a post-retirement marriage, a survivor of a same sex post-retirement marriage, or a civil partner of a post- retirement civil partnership will not include any pre-6 April 1988 membership.

  • CARE (Career Average Revalued Earnings) Pensionable Pay

    This is the amount of pensionable pay paid to you in the year 2024/25 plus the Assumed Pensionable Pay for any periods of:

    • reduced contractual pay or no pay due to sickness or injury
    • ordinary maternity, paternity or adoption leave
    • paid shared parental leave or reserve forces service leave.

    Assumed Pensionable Pay estimates what a member would have been earning if they had been working as normal for a period of time. The same applies if you contribute to the 50/50 section of the scheme.

  • Final Salary Pensionable Pay

    This is your full-time equivalent annual salary as at 31 March 2025. Wherever possible this will include any additional pensionable allowances, but does not include payments for non-contractual overtime or additional hours. If you work term-time for an employer in the Somerset Fund, then the term-time weeks will be reflected in your pensionable pay.

    Important – If your pay is reduced, or increases to your pay are restricted in your last 10 years of continuous employment with your employer:

    If the above applies, you may have the option to have your final pay calculated as the average of any three consecutive years’ pay in the last 13 years (ending on a 31 March).

    You must tell us in writing, that you wish to take up this option either at the time of the reduction, or afterwards, but no later than one month before leaving.

    The criteria options that applies to the reduction in pay to qualify for this protection is shown below:

    • you downgrade or move to a job with less responsibility; or
    • as a result of a job evaluation / equal pay exercise; or
    • as a result of a change to what is specified as pensionable pay in your contract (using the definition of pensionable pay before 1 April 2014); or
    • your pay is restricted for some other reason.

    Please note:

    • You cannot make use of this option to use earlier years’ pay in working out your benefits if the reduction or restriction to your pay was as a result of the loss of a temporary increase in pay, or resulted from a reduction in your grade in order to take retirement benefits on flexible retirement
    • If your pay was reduced or restricted for reasons beyond your control before 1 April 2008 and you were issued with a certificate of protection from your employer and you leave the LGPS within 10 years of the reduction or restriction in your pay, then your final pay will be worked out as the best year’s pay in the last five years, or the average of the best consecutive three years in the last 13 years after allowing for inflation.
  • Death in Service Lump Sum

    This will usually be three times your Assumed Pensionable Pay. Assumed Pensionable Pay is calculated by taking the pay earned over the last 12 weeks or three months that you were working normally (so, excluding periods where you were not receiving full pay due to absence) and converting that to an annual figure. If you have membership in another LGPS fund in England or Wales, or you have a deferred pension, a suspended Tier three ill-health pension or a pension in
    payment, then the lump sum death grant will be the greater of:

    • the death in service lump sum shown on this statement (or, if you have more than one active employment, the total of the death in service lump sum death grants shown on each of your Annual Benefit Statements), or
    • the lump sum death grant due from those earlier benefits.
    If the death in service lump sum(s) is the greater, then no lump sum death grant will be payable from the scheme for those earlier benefits. Conversely, if the lump sum death grant from those earlier benefits is greater, then no death in service lump sum(s) will be due from the current period of membership.
  • Normal Pension Age (NPA)

    The date quoted as your NPA may change in the future if your State Pension Age changes. You can currently choose to take your benefits before your NPA, at any time between ages 55* and 75, but if you do, they will normally be paid at an actuarially reduced rate. Similarly, if you choose to take them after your NPA they will be paid at an increased rate.

    If your NPA under the 2014 scheme is later than your NPA under the 2008 scheme, the figures quoted at your NPA will include any late retirement increases applicable to your pre-2014 final salary benefits. These increases are based on current actuarial factors and may change in the future – they assume that you are still working and in active employment at the relevant date.

    *Please note that from April 2028, the Normal Minimum Pension Age (NMPA) is increasing from 55 to 57. This does not apply if you have to take your pension early due to ill health. This will apply to all new members from 4 November 2021. Please see our Normal Minimum Pension Age page for more information.

  • Increasing your LGPS benefits

    As a member of the LGPS there are two main ways in which you can increase the amount you are saving:

    Additional Pension Contributions (APC’s)

    Since 1 April 2014, if you wish to buy extra LGPS pension for your retirement you have the option of paying APC’s. You can pay in a set amount either monthly or as a one-off lump sum. The APC’s you pay will cover both the employee and employer share of the cost. This buys you a set amount of extra annual LGPS pension, up to a maximum of £8,903 (from 1 April 2025). In some circumstances you can also buy back lost pension, for example, where you have had a period of authorised unpaid leave. Your employer must also pay towards the cost, as long as you decide to buy back any lost pension within 30 days of returning to work (or longer at the discretion of your employer).

    You can find out more information on APC’s and get a quote by either using the online calculator available on the LGPS website or by contacting us via our Member Self Service portal. If you have not yet registered for Member Self Service, please visit our registration page.

    If you are a pre 01 April 2015 member who has chosen to opt out of electronic communications, and are unable to locate the answer to your query, please contact our member services team on 01392 383200 – phone lines are open 8:30am to 1pm Monday to Friday.

    Additional Voluntary Contributions (AVCs)

    Another way to build up extra savings for retirement is by paying separate contributions into our ‘in-house’ AVC scheme. You can choose how much to pay in AVCs and how they are invested. The money will come straight out of your pay and go to Prudential which invests it for you. Your AVC fund is designed to grow as it is invested. You can use your AVC to take some lump sum and/or additional pension from the Pension Fund when you retire or you can buy an annuity. If you are interested in paying AVCs, please contact us using the details at the back of the statement.

    Additional Membership Purchased – Pre-2014 Contracts Only

    If you have paid or are paying additional contributions to buy extra membership then the additional membership that you have purchased to-date has been included in the figures shown in your statement.

    Additional Pension Purchased

    If you have paid or are paying additional contributions to buy extra pension then the additional pension that you have purchased to-date has been included in the figures shown in your statement.

    Restriction of Pensions Tax Relief

    The annual allowance is the amount your pension savings can increase by in a year without you having to pay extra tax. If your savings increase by more than the annual allowance, you will have to pay tax on the excess. The standard annual allowance increased from £40,000 to £60,000 on 6 April 2023.

    You are most likely to be affected if you are a high earner, have had significant pay increase or pay a high level of additional contributions. Most people aren’t affected by the annual allowance because their pension savings don’t increase by more than £60,000 in a year.

  • Protection Close to Retirement

    Statutory Underpin: This is for scheme members who retire at age 65 and were within 10 years of that age on 1 April 2012. This protection ensures that these members receive a pension no less than had they continued in the old scheme. Eligible members must:

    • have been paying into the scheme on 31 March 2012
    • not have had a break in service of more than five years
    • not have drawn any LGPS benefits
    • not opt out of the scheme

    A comparison will be made at retirement between the benefits due under the new scheme and the benefits eligible members would have expected to receive had the scheme not changed from 1 April 2014.

    If the benefits under the old scheme would have been greater, the difference will be added to their pension. Please note: no underpin protection is included in the benefits quoted in this statement.
  • Pension Liberation Fraud

    You may have heard about an activity called Pension Liberation Fraud. This is where scheme members are approached by unscrupulous companies promising instant cash sums and/or early access to their pension, as long as they transfer their pension savings to them.

    The Pensions Regulator has more information on this and other pension scams.

    Please also visit our page Transfer pension rights out of LGPS for more information.

    You cannot transfer your benefits (other than AVCs) if you leave less than one year before your Normal Pension Age. An option to transfer (other than in respect of AVCs) must be made at least 12 months before your Normal Pension Age.
    Deciding to transfer your benefits is an important decision, we recommend you seek independent financial advice and read the information on the above links so that you are fully informed of the potential risks before doing so.

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