What is a defined contribution scheme?
This is the same as a money purchase plan. It can be an occupational trust based plan or a personal pension arrangement under a contract with an insurance company.
What is a defined benefit scheme?
This is an occupational pension scheme where your pension is linked to your earnings and how long you work for your employer. The most common type is a final salary plan.
What is a Group Personal Pension (GPP)?
A group personal pension plan (GPP) is a collection of personal pension plans provided by an employer for its employees. Customers investing in a GPP can do so via our Pension Investment Approaches, our Premier Pension Investment Approaches or choose our self investment option for greater investment choice, flexibility and control.
What is a Group Stakeholder Pension (GSHP)?
A Stakeholder pension differs from a personal pension plan because it has been designed to incorporate a set of minimum standards laid down by the Government relating to charging structure, penalties and minimum contributions. For more information go to the pensions advisory service.
What is a defined contribution occupational pension plan?
A pension plan which is written under trust that provides retirement benefits based on the build up of a ‘pot’ of money, from the investment of contributions paid by both the employee and the employer. It is run by a board of trustees who are responsible for paying retirement and death benefits. This is a type of money purchase or defined contribution plan.
What is an Executive Pension Plan?
An Executive Pension Plan (EPP) is similar to an occupational pension plan but it is normally used for Directors and senior employees.
What is a Trustee Buyout Plan (section 32a)?
Trustee Buyout Plans are plans which are set up to accept a transfer value only. They can be bought by the trustees of an occupational money purchase pension scheme who are seeking to wind up their scheme. When the scheme is wound up, members' benefits are transferred into Trustee Buyout Plans and Scottish Widows issues the individual members with their own policies.
How can I top up my pension?
There are several ways to top up your company pension plan.
If your payments are a percentage of your earnings, your payments will automatically go up in line with any increase in your earnings.
To increase payments or pay in a lump sum, use our online services or contact our Corporate Pension Members Helpdesk on 0345 755 6557 (8am to 6pm weekdays).
If you leave your job, your current employer will stop paying in and any payments they deduct from your salary will also stop when you leave their employment.
Reducing or stopping your payments would normally result in you having less to support you in retirement. If you stop paying in to your pension plan, the money already built up in your plan can remain invested until you retire, and we will continue to deduct our yearly charge.
You can arrange to continue to make payments from your own bank account if you wish. If you’re not currently paying anything by this route, you can start payments at any time. Please call our member helpline on 0345 755 6557 to arrange this.
If you get a new job, your new employer may be able to start paying into this scheme if they wish. If they have their own scheme, you may be able to join it.
My policy has been open a year, can I get a refund of the money I paid in?
You can only get a refund within 30 days of joining. After 30 days your only options are to leave the contributions invested or transfer them to another pension plan.
How do I register online?
From the Scottish Widows website choose the option to register in the top right hand corner. then follow the instructions as per your pension type.
Where can I find fund performance history?
If you click on the link below you can access all the different funds available under different product contracts – each fund has its own fact sheet giving the performance history as well as in depth details.
What does Switch and Redirection mean?
Switching is when you or an IFA transfer the money within your plan from one fund to another. Redirection means the redirection of future premiums into another fund option, whilst existing money remains invested in the existing fund choice. Switch and Redirection can be used together.
What is the cash fund?
The fund aims to provide long-term growth consistent with high levels of capital security by investing mainly in short-term securities. The fund can invest in high-quality, mostly short-term debt instruments such as fixed deposits, certificates of deposit, commercial paper and floating rate notes. It carries a relatively modest risk to capital.
I have changed my name what do I need to do?
Depending on the reason for the name change, send in a Deed Poll document for general name changes or through marriage we have to see the original marriage certificate and birth certificate or certified copies which can be done via a Lloyds branch for no additional cost.
My new illustration quotes say they cover me and my wife/husband but I am not married and why does it show a three year age difference?
This is an industry standard and is the same on all pension company quotes. If you are male, it assumes you have a spouse who is 3 years younger, and if you are female, it assumes you have a spouse 3 years older.
What happens to my pension plan if I die before taking my benefits?
If you die before you take anything from your pension, it will usually be paid as a lump sum to your beneficiaries tax-free.
If you die before age 75
As long as your pension plan is less than the lifetime allowance (£1.03 million in tax year 2018/19) your pension can be paid to your beneficiaries tax-free, either as a lump sum, an annuity, or through flexible drawdown.
If you die age 75 or older
Your pension can be paid to your beneficiaries either as a lump sum or through flexible drawdown. All payments will be subject to income tax at their marginal rate.
There will normally be no inheritance tax to pay.
If you have taken money from your pension pot, what happens to the money left in it will depend on how you decided to use your pension pot. See Retirement Basics for more information.
Can I transfer another pension policy with another provider into my plan with Scottish Widows?
Yes – if the pension you are looking to transfer in is eligible you can transfer online. If you decide to move your pension it will be transferred on a non advised basis. Follow our simple process to transfer your pension.
Can I pay single premiums to my policy online?
All individuals have different access packages defining what transactions can be undertaken online. You can check with your employer what access package has been set up for you.
For example, if you have ‘basic access’ you would only be able to view policy details and plan valuations, whereas with ‘full access’ you have the option to make changes, fund switch/redirections, add single premiums etc to your plan.
To find out what your access package is please contact our Member Helpline on 0345 755 6557 or contact your scheme administrator. Access Packages are agreed by your employer and IFA at inception of the plan.
What does annual allowance mean?
Annual allowance is the annual yearly amount you can contribute to your pension. Contributions above this amount are subject to a tax charge. The level of the annual allowance is decided by the government. Higher earners will have a lower annual allowance limit called the ‘Tapered Annual Allowance’. In certain circumstances, you may be able to take advantage of up to three years’ previous unused allowances. Please speak to your financial adviser for further details.
What does money purchase annual allowance mean?
If you take a pension encashment or take benefits under flexible access drawdown, you will be subject to the Money Purchase Annual Allowance (MPAA) which is currently £4,000. You will only be entitled to obtain tax relief on contributions to all money purchase pensions up to £4,000, after which you will be subject to an annual allowance charge.
What does ‘lifetime allowance’ mean on Retirement forms?
A Lifetime Allowance, set by the government, will apply to the total value of pension benefits you can receive from your pension plans. The Lifetime Allowance has been set at £1.03m for the tax year 2018/2019.
Can I take my benefits before age 55?
This is the minimum age you can start taking your benefits unless you are in a designated profession with a lower age limit or if you are retiring on the grounds of ill health.