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Am I able to transfer a pension into/out of FPS?

 

Transfer of Pension Rights out of the FPS

If you leave the FPS with three or more months' service but not being eligible for immediate payment of a pension because you are not old enough, nor retiring on grounds of ill health, as an alternative to a deferred pension you could request that your pension rights should be transferred to some other pension arrangement.  A transfer value, a sum representing the capital value of your pension rights, would be assessed in accordance with guidance provided by the Government Actuary and offered to the managers of your new pension scheme.  The transfer would take place if you so instruct.

  • If you leave the scheme and have two or more years' qualifying service (or if you transferred pension rights into the FPS from a personal pension scheme) you can:
  • transfer your FPS pension rights to a registered occupational pension scheme with defined benefits; or
  • transfer your FPS pension  to a registered overseas pension scheme (ROPS) that does not offer flexible benefits; or
  • retain deferred benefits within the FPS.

The Pensions Schemes Act 2015 restricted transfers out of unfunded defined benefit public service schemes, which includes the FPS, except to other defined benefit schemes, unless certain conditions are met. These changes came into effect from 6 April 2015, and as a result it is no longer possible to transfer your FPS benefits to a flexible benefit overseas pension arrangement, or  a defined contribution (DC) scheme from which the benefits provided in respect of the transfer credits/rights are flexible benefits, unless you have more than 3 months and less than 2 years qualifying service in the FPS.

  • Flexible benefits are defined as:
  • a money purchase benefit,
  • a cash balance benefit, or
  • a benefit, other than a money purchase benefit or cash balance benefit calculated by reference to an amount available for the provision of benefits to or in respect of the member (whether the amount so available is calculated by reference to payments made by the member or any other person in respect of the member or any other factor)

There are a number of issues to consider before making a transfer:

  • you may wish to seek the help of an independent financial advisor before making any decisions (mandatory for cash transfers over £30,000)
  • you are not entitled to a transfer out from FPS if you received a refund of contributions - a transfer will be possible only if you repay the refund first
  • you will not be able to have a transfer if you are within a year of reaching the age of 60
  • the transfer value may not necessarily buy the same length of service in the new scheme - an estimate from the new scheme should provide an indication
  • the range and type of benefits offered by another scheme may be quite different from those offered by FPS
  • overseas transfers may be subject to a 25% tax charge, details of which can be found here.

Transfer of Pension Rights within the FPS

If you leave your employment with your current fire and rescue authority and transfer to further employment as a firefighter with another authority, provided there is no break in service between employments, you would remain a member of the FPS.  Your pension rights will normally transfer with you and a transfer value payment is made for any transfer either from or to a Scottish FRA.  The authority you leave would simply send a statement of your pension entitlement to your new authority.  Due to the financing system introduced in England payments for transfers between English FRAs are no longer made.  You may leave employment with your current fire and rescue authority to transfer to another authority where you remain a member of the NFPS.  If the new employment is at a lower rate of pay, the split pensions option (see scheme guidance) would be available to you.  Your pension rights normally transfer with you and a transfer value payment is made for any transfer either from or to a Scottish FRA.

 

Link to Scottish Government Website