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If you become entitled to payment of a retirement pension, a deferred pension or an ill-health pension you may opt to give up part of your pension for a lump sum. This is known as commutation.

If you decide to exercise this option, for every £1 by which the amount of your annual rate of retirement pension or ill health pension is reduced, you will be paid a lump sum of £12. Your commutation lump sum cannot be more than 25% of the value of your pension.


A member is about to retire with a pension of £20,000. S/he wants to commute 20% of his/her annual pension into lump sum. S/he would be eligible for a lump sum of £48,000 (=20% x £20,000 x 12) and a revised pension at retirement of £16,000 (=80% x £20,000).

If you wish to exercise the option to commute some of your pension for a lump sum you will have to provide written notice to your Police Pension Authority.

Please note that the decision to commute your pension to lump sum will have to be taken before the date of your retirement.

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