With today’s increasingly fluid workforce, many people have had numerous employers and participated in an array of different company pension arrangements. This means that they could have various pension benefits scattered all over the place. Does this sound familiar? Assuming it’s appropriate to your situation, wouldn’t it be great if you could pool all of your pension benefits into one pot, so you knew exactly where your money was?
All change
There are a number of different reasons for stopping contributions to an employer’s pension scheme.
* You change jobs, leave the old pension scheme and want to join your new employer’s scheme.
* You leave your company to become self-employed.
* You are made redundant.
* Your employer introduces a new type of scheme after a takeover, merger or privatisation.
What next?
The most common case that could lead to a transfer of your pension benefits is when you change jobs and join another employer.
If you were in a previous occupational scheme and made contributions for less than two years, you might be able to get your own contributions (not the employer’s) back, less a charge for tax. However, after two years the rules are different.
After two years:
* You could leave the pension benefit in your former employer’s scheme (known as a ‘deferred’ or ‘preserved’ pension).
* You could take a transfer of benefits (the ‘transfer value’) to your new employer’s scheme - providing the receiving scheme will accept it.
* You could take a transfer value to an Inland Revenue approved private individual plan, such as a stakeholder arrangement.

It’s important that you consider not only any previous pension arrangements, but also your existing provision - we can help you fill in any gaps! Please e-mail or contact us for further information.

Levels and bases of, and reliefs from, taxation are subject to change. Because these investments may go down in value as well as up, you may not get back the full amount invested, especially if you withdraw from an arrangement in the early years. The Financial Services Authority does not regulate tax advice.

(article dated 1/11/03)