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I'm thinking of going back to work

Should you become re-employed as a teacher after retirement you will automatically be re-entered into the scheme and may be subject to an earnings limit. This limit applies whether your re-employment is pensionable or not, therefore opting out of the scheme on re-employment, makes no difference to the earnings limit. If you exceed the earnings limit, your current pension may be reduced. If, however, you retired on Actuarially Reduced Pension or on phased retirement grounds, your pension will not be affected.

In line with other public sector scheme, members who are re-employed after taking their pension benefits must have a break of at least one working day.  It must be shown that it was a clear intention on the part of the member to retire.

After retiring and becoming re-employed, which Scheme would i join?

  • If you returned to work after retirement before 01 April 2012, you will remain protected under your previous scheme arrangements.

  • If you returned to work after retirement between 02 April 2012 and 31 March 2015, you will accrue mixed benefits from 01 April 2015. Your previous scheme arrangements will be protected up to 31 March 2015. Any benefits accrued after 01 April 2015 will fall under the new CARE scheme.

  • If you return to work after retirement from 01 April 2015, you will automatically join the CARE scheme.

What is my earnings limit and how is it calculated?

The earnings limit is based on your Salary of Reference (SOR).  This is the highest salary rate in the period used in the calculation of your pensionable salary plus PI, less your SPPA pension. Any discretionary compensation being paid by your employer is also deducted. See example below.

Example

A teacher retires on SOR of £35,000 and receives an annual pension of £10,000 per annum from SPPA and £2,000 per annum from their employer.

Salary of Reference                   = £35,000.

Total annual pension received   = £12,000

Earnings limit                              = £23,000

 

How are my earnings monitored?

If, during re-employment, your pay approaches or exceeds the earnings limit in any tax year, you should inform us immediately as your pension may be reduced or suspended.

It is in your own interest to do so at the first opportunity because your employer will supply us with details of your earnings at the tax year end and we are obliged to recover any overpayment in a lump sum. The easiest way to check your earnings in any tax year is to look at Your Earnings to Date in your payslip.

Earnings limit Increases

If your pension increases your earnings limit will increase by the same amount. A calculator can be found here to enable you to calculate your own earnings limit. You should only contact us if you are close to exceeding your earnings limit. The statement we provide to members on retirement will give details of the Salary of Reference used in the calculation of benefits. It will also give the amount of pension payable by us and the mandatory pension payable by your employer, if applicable. If you are receiving any discretionary compensation, you will need to obtain this amount from the source and deduct this to calculate your earnings limit.

I retired on ill health grounds - can I return to work?

If you retired on due to ill health and return to work or are considering returning to work, please contact us for more information specific to your case. Your pension may be stopped on re-employment if the post is eligible to be in the STSS.

I have continued to pay contributions – what happens to my contributions?

If you decide to pay contributions to the STSS and have completed one calendar year of re-employment, you are eligible to claim a second pension, irrespective of the service accrued for that period. If your re-employment ends before one calendar year, a short service annuity is appropriate. If you exceed your earnings limit, we will contact you on an annual basis, for as long as we believe you to be re-employed, with an updated earnings limit. If your circumstances change within that time, please contact us.

Link to Scottish Government Website