If you leave teaching, and what is known as pensionable service, you will become a Deferred Member. You may be able to apply for a repayment of your contributions or transfer- out. Alternatively, you can leave your benefits where they are and pick up where you left off if you pick up teaching down the line.
If you are already in receipt of benefits from the scheme, you can no longer take a repayment. Your benefits will be automatically triggered once you reach Normal Pension Age.
If you are a Deferred Member who has not yet reached the Normal Pension Age, then your benefits within the career average arrangement will be revalued using the annual pensions increase rather than an active service revaluation. What if you have a break of more than five years and then start teaching again? At this point, your accrual will only be revalued on your new active payments.
You can transfer-out your pension if your new scheme is a defined benefits scheme and they will accept the transfer. Also, the receiving scheme is a recognised scheme that satisfies HMRC requirements. You may need to speak to an independent financial advisor to assist with such a transfer.
The content in this article was correct on 15th November 2019. You should not rely on this article to make important financial decisions. Teachers Financial Planning offers advice on pensions for teachers and non-teachers. Please use the contact form below to arrange an informal chat with an advisor and see how we can help you.
