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F.A.Q.s
Scheme Membership and contribution rate
Pensionable service and estimate of retirement benefits
Increasing my benefits in the Scheme
Additional Voluntary Contributions
Nomination of Spouse or Partner
Question and Answers from the Employer Seminars
Scheme membership and contribution rate
Q. How much are my contributions to the STSS?
A. The scheme reforms and improvements mean the contribution rate payable by members from 1 April 2007 is 6.4%.
Q. I was a member of the STSS before 1 April 2007. Can I “opt into” the arrangements for new entrants?
A. No. The arrangements for new entrants are for those who first enter the STSS on or after 1 April 2007 and for the future service of existing members who return to the scheme after a break of more than five years.
Pensionable service and estimate of retirement benefits
Q. Why is there teaching service missing from my record of service?
A. SPPA are not the direct employer of teachers and therefore rely on teachers' employers to provide service and salary details. This information is provided annually by employers and therefore if the information for the last financial year is missing from your statement of service this is because the information has yet to be updated from your employer. If service is missing from an earlier period you may wish to contact the relevant employer asking them to notify SPPA of the appropriate details.
Q. What is the maximum service I can accrue in the Scheme?
A. You can accrue a maximum of 45 years in the scheme. You can only however, have a maximum of 40 years service at age 60.
Q. When will I receive my benefit statement?
A. SPPA will issue your benefit statement via your employer on an annual basis. An annual circular is sent to your employer providing advance notice of the issue date.
Increasing my benefits in the scheme
Q. How can I maximise my benefits with the STSS?
A. You can buy additional pension or you can take out an Additional Voluntary Contribution (AVC). If you buy additional pension you can either pay a lump sum or have additional contributions deducted from your salary. For further information a calculator is available on the SPPA website that can be used to provide an indication of costs. If you want to take out an AVC the in-house provider is Prudential, but you can use other providers. For more information, contact the Prudential at
Teachers’ AVC Department
Prudential
Craigforth
Stirling
FK9 4UE
Telephone: 0845 0700 007
Website: www.pru.co.uk/teachers/
Following changes introduced by Her Majesty’s Revenue and Customs (HMRC) in April 2006, you are able to save in more than one pension scheme at the same time.
Q. Can I transfer my pension credit to the STSS from another scheme?
A. When you join the STSS, you can transfer pension credit from a previous scheme including an overseas scheme, as long as the previous scheme meets Her Majesty’s Revenue and Customs (HMRC) requirements and you apply for a transfer within 12 months of entering pensionable employment.
For further information about transfers, see the Guide to Preserving and Transferring your benefits. This can either be downloaded from the website or requested by contacting the Agency.
AVCs and FSAVCs (Additional and Free Standing Additional Voluntary Contributions)
Q. Will I receive my teachers’ AVC benefits when I receive my STSS pension?
A. Payment of your teachers’ AVC benefits does not have to be linked to payment of your STSS pension. You could access your teachers’ AVC at any time from age 55. If you have a Free Standing AVC arrangement you will need to contact the AVC provider as their rules can vary.
Q. How do I find out what benefits will be due from my AVC?
A. The In House AVC facility is administered by Prudential so you should contact them with any queries regarding the amounts that may become payable.
Q. Can I use my AVC fund to purchase additional pension?
A. No, it is not possible to purchase additional pension in the STSS with funds accrued under either an AVC, or Free Standing AVC arrangement, or by using a tax-free lump sum from another pension arrangement.
Q. Can I transfer an existing Free Standing AVC into my Teachers' AVC fund?
A. Yes. Free Standing AVC funds can be transferred to the in house AVC facility with Prudential.
Nomination of a Spouse or Partner
Q. I am not married and live with my partner. Can I provide benefits for them?
A. Yes, both new entrants and existing members, who are not married or have not entered into a civil partnership agreement, are able to provide dependent benefits for ‘nominated’ heterosexual and same sex partners. There is a qualifying period of two years’ pensionable service from 1 April 2007. If you are an existing member you can buy in pre 1 April 2007 service for a surviving partner benefit at full cost and this will count towards the qualifying period. You must complete a nomination form either on the web or on paper to nominate your partner.
Q. I have already retired and I am living with my partner. Do the surviving partner benefit proposals cover us?
A. Surviving partner benefits only apply to members who were in pensionable service on or after 1 April 2007 and retire after that date.
Leaving the STSS
Q. What happens to my pension when I leave pensionable employment?
A. If you leave pensionable employment there are three options open to you:
Leave your pension credit in the STSS. This is called ‘preservation’. These preserved benefits increase in value each year at a rate equivalent to the Retail Prices Index (RPI). Transfer your pension credit to another form of pension provision. If you have not qualified for benefits you can take a repayment of your pension contributions
Q. How do I go about transferring my pension credit to another pension scheme?
A. If you want to transfer your pension rights out of the STSS, SPPA needs a formal request from your new pension provider. When SPPA receives the request, a guaranteed statement of entitlement will be issued, normally within three months. Once the signed acceptance and a request for the transfer value is received from your new provider, SPPA will issue the payment. If you are a pension credit member you cannot transfer out of the STSS.
Q. Why do I only get approximately 55% of my contributions, if I opt for a repayment?
A. The amount you will be repaid will be the contributions you have paid into the STSS together with compound interest added at 3% per annum. Two deductions are made, one to pay back your entitlement in the State Pension Scheme and the other, a standard charge for tax at a flat rate of 20%.
Retiring from the scheme
Q. Can I continue to work beyond normal pension age and accrue benefits in the scheme?
A. Yes. The scheme rules allow you to work beyond normal pension age accruing up to a maximum of 45 years service.
Q. I was a member of the STSS before 1 April 2007 and intend to work beyond age 60 and not draw my pension until I am aged 65. Will my benefits be enhanced?
A. No, actuarial enhancement is only available to those who have a Normal Pension Age (NPA) of 65 and continue in work beyond that age. But your pension would be bigger because you would have more service and further salary increases.
Q. How can I find out the size of my pension fund so I can calculate the amount of tax-free cash I can take when I retire?
A. The actual formula is complex and so a modeller about the tax-free lump sum is available on the Calculators section of this website.
Q. What is the LTA (Lifetime Allowance)?
A. The Finance Act 2004 introduced a single tax regime that applies to all UK tax-privileged pensions. This new regime introduced a Lifetime Allowance (LTA), which is the total allowable value of all privileged pensions from all sources. If the value of your total pensions, within the current limits, exceeds the LTA, you will have to pay additional tax, called a recovery charge, of 25% on the excess.
Q. What is phased retirement?
A. You may take phased retirement without having a break in employment provided that your pensionable salary reduces by at least 25% for a minimum of 12 months. This could be because you have taken up a post of lesser responsibility or because you are working less hours. You can decide how much you wish to take of the benefits you have accrued up to the start of your phased retirement, subject to a maximum of 75% of your total benefits. Your remaining service will be aggregated with the subsequent service you accrue.
Q. I have received information from you stating that my benefits will be paid on the due date – when is this?
A. The due date is either the day after your last day of service or your NPA which ever is the later date. If you are retiring on the grounds of phased retirement your due date is normally the first day you are employed on a lower salary. If you are out of pensionable service and are taking Actuarially Reduced retirement your due date will be the date of your choice but this cannot be earlier than age 55 or 6 weeks from the date you signed the application. Where your application is received after or close to the due date SPPA will make best endeavours to ensure that your application is processed within 20 working days of the receipt of your application form.
Pension benefits
Q. I joined the Scheme after 01 April 2007. How much will I receive when I retire?
A. You will be entitled to annual pension of 1/60th of your pensionable salary for each year’s reckonable service, with the option of commuting up to 25% of your fund value to a lump sum.
Q. Will I receive a lump sum when I retire?
A. Yes, if you were a STSS member prior to 1 April 2007 you will receive a lump sum of 3/80th of the average salary for each year of pensionable service. You may increase this lump sum and for each £1 of pension commuted this will increase your lump sum by £12. If you joined the STSS after 1 April 2007 there is no automatic lump sum, however, to get a lump sum you can commute £1 of pension for £12 of lump sum. You can commute up to 25% of your total pension benefits.
Q. Are the benefits from the STSS index linked?
A. Yes, for both members who were in the STSS before 1 April 2007 and those who joined after that date. Pensions are index-linked in line with annual changes in the Retail Price Index (RPI) each September. This determines if a pension is to be increased from the following April and if so by how much..
Q. Does the STSS provide ill-health retirement benefits?
A. If, before you reach Normal Pension Age (NPA) you have become permanently unfit because of illness to serve as a teacher, ill-health benefits may be paid. Ill-health benefits are paid at two different levels depending upon the severity of your illness. Total Incapacity Benefit (TIB) is awarded if you are assessed as being permanently unable to teach and unable to undertake any other gainful employment. Partial Incapacity Benefit (PIB) is awarded if you are assessed as being permanently unable to teach but able to do other work.
Q. What is payable when I die?
A. When you die a lump sum death grant of three times your pensionable salary will be paid if you have not retired and a pension may be paid to your dependants. For further information about death grants and pensions see the Death Benefits or Family Benefits sections of this site or contact the SPPA directly.
Q. When do I apply for retirement benefits?
A. You should apply using the relevant form about four months before the date you wish to draw your pension. Which form you use depends on your circumstances when you retire. Your employer will be able to give you further advice and provide the relevant form.
Working after retirement
Q. Can I continue to work after receiving retirement benefits?
A. If you are 55 or over you may take phased retirement without having a break in employment provided that your pensionable salary will reduce by at least 25% for a minimum of 12 months. If you retire on phased or actuarially reduced benefits you will continue to accrue further pension benefits and your pension will not be affected. If you retire on ill health grounds your pension will stop as soon as you start work. If you retire on age or premature grounds you will continue to accrue further pension benefits but your current pension may be reduced whilst you are working.
Questions and Answers from the Employer Seminars 2010
Q. Can we have the RET forms in word format so we can send them in electronically?
A. This may be something we can progress to in the future but at the moment our regulations state that we must have a signed declaration from both the member and employer at retirement.
Q. Are short term pensions paid for by the employer?
A. Yes, but it is reclaimed through contributions.
Q. Is the short term pension for children paid up to age 18?
A. No, it is payable to age 17 or if they remain in full-time education to age 23. If the child is incapacitated the pension may remain in payment for life, however this would need to be determined by the medical advisor.
Q. If an employees sick pay runs out does that disqualify them from taking premature retirement?
A. Yes.
Q. Are Capitalisation factors available on the SPPA website?
A. Not at the moment, but they are on Teachers pensions website.
Q. Do we reduce the original lump sum before commutation?
A. No.
Q. Are there any regulations regarding which type of posts are eligible for winding down?
A. No.
Q. What level of winding down contributions do the members and employers pay?
A. They pay the same percentage
Q. What is the level of dependant's pension?
A. It depends on the level of family benefits they have accrued in the scheme.
Q. If a member is in receipt of PIB, can they work? and how broad is the range of jobs they can do?
A. They can be employed in any job outside of Teaching.
Q. What if a member is in receipt of PIB and they return to work that is not teaching but is in the education sector?
A. The member cannot undertakeany employment which would qualify them to join the STSS.
Q. How long does ATOS take to make a decision?
A. If all applications are complete the ATOS make a recommendation within 5 days of receipt. In terminal cases, the recommendation is made within 24 hours.
Q. As the employer, we are unsure who is able to join the STSS. What happens in an ill-health case?
A. If they are a member of the scheme then ATOS will make the recommendation. This is why it is always important that Job descriptions are included in all applications. If they do not teach then they should not be allowed to pay into the STSS. The meaning of "Advisor" is currently being investigated.
Q. In IDRP Stage 2, who is the appointed person who makes the decision?
A. It is an idependent doctor in each case, with no input from any individual previously involved. The patient is seen by a doctor who specialises in the diagnosed illness. The member is not expected to travel and will be seen their local area.
Q. In ill-health cases what % of cases sees a doctor face to face?
A. All ill health referrals are paper based. If the referral goes to IDRP stage 2, they will be seen face to fact by a doctor.
Q. In ill-health cases does the member get enhancement up to age 60 or 65?
A. An enhancement is paid to their normal retirement age, either 60 or 65.
Q. If you have been granted TIB and you reach age 60, what happens?
A. If TIB has been awarded there is nothing further payable.
Q. If you are granted PIB, can you still work?
A. Yes, as long as it is not teaching.
Q. What happens if their role is not entirely teaching?
A. When ATOS make their recommendation they take the member's job description into consideration. Employers must ensure that the member is appropriate to be in the STSS.
Q. Are the ill-health applications being more accurately completed than in the past?
A. Yes, there has been some recent improvement in this area.
Q. If a member is awarded PIB do they get a lump sum?
A. Yes, they will receive a lump sum and pension with no enhancement.
Q. What is the definition of a teacher, if someone is in the scheme but does not teach, does that mean they can only get TIB?
A. All members of the STSS are treated equally and can be eligible for PIB or TIB.
Q. Should employers automatically check with the STSS that employees are eligible to be in the scheme?
A. Employers can check with STSS on a member's eligibility by submitting their job description.
Q. Has there been any instances where members have been removed from the scheme?
A. Yes there have been several instances of teachers who are no longer able to stay in the scheme after switching their roles.
Q. What about someone who is on a teacher's pay scale, for instance a quality improvement officer?
A. This is a grey area. We have approached HMRC to have members with this job description and similar to be specifically named in the scheme, but HMRC advised that this is not appropriate.
Q. What constitutes a smaller employer when it comes to the new data interfaces?
A. Any non-local authority employer (i.e. colleges, universities, independent and charitable employers).
Q. Why has the submission of annual returns been brought forward from June to May and is there any lee-way on this timescale?
A. To enable us to deal with August retirals and make sure benefit statements go out on time so there is no lee-way.
Q. How do employers submit multiple contracts on annual returns?
A. Email PCT for example.
Q. Do we submit a TSS2 when a member is on maternity leave?
A. Only submit when the member does onto nil pay.
Q. Is there an example of the benefit statement on the website?
A. There will be one put on in future.
Q. Why if our annual returns were on time, were benefit statements late?
A. There have been complications with some statements using our new system.