New Benefits

For members who joined after 30 September 1996 and before 1 November 2006.

what if...

What happens if I opt out or leave service?

If you opt out or leave service you will no longer be an active member.

You will be entitled to a deferred pension payable at normal pension age. Your pension will be calculated as outlined here.

Deferred pensions receive increases during the period of deferment the same rate as pensions in payment including any increases required by legislation.

You can ask for your deferred pension to be paid before normal pension age, either because of incapacity or from age 55 onwards.

Payment is subject to agreement by the Trustees and your pension will be reduced for early payment. If you opted out and are still in service, the agreement of the BBC will also be required. The scale of reductions is set by the BBC and the Trustees at the beginning of each calendar year. In cases of incapacity the Trustees have discretion to waive some or all of the reduction. 

The following percentages are currently in use:

Retirement age 55 56 57 58 59 60
% reduction 24 20 16 11 6 0

Between birthdays the reduction is proportionate.

Instead of being entitled to a deferred pension from the Scheme, you can choose to transfer the value of your Scheme pension to one or more registered pension arrangements in the UK or overseas at any time before your pension starts.  Unless you confirm otherwise, the Scheme Trustees will assume that the purpose of any transfer is to provide defined contribution (DC) benefits under another pension arrangement.  The transfer value will be calculated in line with overriding legal requirements and is designed to represent the actuarial value of your benefits.  

If you choose to transfer your Scheme pension to a DC arrangement, unless its total value is £30,000 or less on the valuation date, the Scheme Trustees will be required to check that you have recevied appropriate independent financial advice from a suitable financial adviser approved by the Financial Conduct Authority.  Please contact the pension service line for more information.

Different pension providers offer different options in relation to what you can do with flexible benefits, including the option to select an annuity.  Different options have different features, different rates of payment, different charges and different tax implications.

There may be tax implications associated with accessing flexible benefits.  Pension income is taxable and the rate at which income from a pension is taxable depends on the amount of income your receive from your pension and other sources.

Does temporary absence affect my pension?

Unpaid absences in the United Kingdom

Up to three months

Absences expected to last three months or less (other than those due to sickness) are treated as pensionable service, on condition that:

  • contributions are paid by both you and your employer;
  • you do not join another occupational pension scheme; and
  • there is a definite expectation that you will return to work for the BBC or a participating employer.

Recovery of contributions is automatic on your return, with the arrears being spread over six months, subject to Scheme limits on contributions.

More than three months

If your absence is expected to last more than three months, there must be prior agreement to maintain contributions in order for the period of absence to be treated as pensionable service. Both you and your employer must agree with the Service Delivery Manager before the absence begins that normal contributions will continue.

The same conditions as for absences of three months or less apply and the period of absence should not last for more than 10 years.

If no prior agreement is recorded, your pensionable service ends when your absence begins. You will be treated as having opted out and will become a life assurance member, with lump sum death benefits limited to two times the pensionable service that would have been paid but for the absence. In addition, if you become a life assurance member after 31 March 2011, this benefit will be reduced by any lump sum death benefit payable in respect of your deferred pension. Having opted out, you will not be permitted to rejoin the Scheme.

Unpaid absences outside the United Kingdom

If you are no longer resident in the United Kingdom, you cannot continue to build up benefits in the Scheme. You will be treated as having opted out and will automatically become a life assurance member, with lump sum death benefits limited to two times the pensionable salary that would have been paid but for the absence. In addition, if you become a life assurance member after 31 March 2011, this benefit will be reduced by any lump sum death benefit payable in respect of your deferred pension.

Such absences are best dealt with individually and should be referred to the Service Delivery Manager before they begin.

Sickness absence

All periods of sickness absence are treated as pensionable service. During paid sickness absence, normal contributions are deducted. You will not be expected to make good unpaid contributions if you have a period of unpaid sickness absence

Family leave

Periods of paid family leave (i.e. maternity, adoption, paternity or parental support leave) are treated as pensionable service and normal contributions will be deducted.

If you want the whole part of a period of unpaid family leave to count in full as pensionable service, you will need to complete a form, which you can get from the documents page. The form needs to be completed and received by the Trustees within three months of your return to work, after which the option lapses. Arrears of contributions will be calculated on your current pensionable salary and must be paid within six months. If you do not make good the arrears, you will be credited with 60% of your unpaid family leave as pensionable service

Secondments

If you are seconded to work for another, non-participating employer, you can continue to build up pensionable service, on condition that:

  • contributions are paid by the non-participating employer and you during the same Scheme year as the pensionable service is earned;
  • there is a definite expectation that you will return to work for the BBC, or another participating employer;
  • the secondment, in total, does not exceed 10 years; and
  • the benefits build up using the pensionable salary that you would have received, if you hadn't been seconded.

Additional restrictions may apply if your secondment is to another EU country.

Career breaks

If it is agreed that you take a career break, you will be treated as having left service. If you are re-employed, you will be eligible to re-join the Scheme as a New Benefits member provided that you do so at the first possible opportunity (ie immediately you become eligible). When planning a career break, you should consider carefully the impact it will have on your pension.

Further information is available from the pension service line.

What happens when I die?

Death in service

If you are an active member of the scheme and die in service, the following benefits are payable:

A lump sum

The Trustees will make a lump sum payment, which is currently free of inheritance tax. It will be equal to the lesser of four times your life cover pensionable salary as at the date of your death and your remaining Lifetime Allowance. The Trustees have discretion over who receives the cash and in what proportion. They take into account, but cannot be bound by, your wishes. You are therefore asked to let the Trustees know your choice of beneficiaries by keeping your expression of wish form up to date. If your circumstances change, a new form is available from the pension service line.

You should read the note 'BBC Pension Scheme death in service provisions' for more information. The note is available from the pension service line.

If the lump sum is restricted because of the Lifetime Allowance, the balance will be used to provide additional pension for your dependants.

A dependant's pension

Your qualifying spouse or qualifying civil partner will receive a dependant's pension calculated as follows:

  • It will be half of the pension you would have received had you remained in pensionable service until normal retirement age, but based on your final pensionable salary at the date of your death.
  • If you have no qualifying spouse or qualifying civil partner, your nominated dependant will receive a pension. A pension paid to a nominated dependant will be reduced by any GMP payable and will not be payable if there are two or more qualifying children

Example:

Janet dies at age 45 with 15 years' pensionable service. She therefore has a further 15 years' potential pensionable service to normal pension age. Her final pensionable salary at the date of death is £30,000.

The dependant's pension is: 30/60 x £30,000 x 1/2 = £7,500 pa

Children's pensions

If a pension is payable to a qualifying spouse or a qualifying civil partner your qualifying children (up to a maximum of two) will each be entitled to a quarter of the pension you would have received had you remained in pensionable service until normal pension age, but based on your final pensionable salaryat the date of your death.

If no qualifying spouse or qualifying civil partner's pension is payable, the children's pensions will be the lesser of:

  • a pension for each qualifying child (up to a maximum of two) of one half of your pension you would have received had you remained in pensionable service until normal pension age, but based on your final pensionable salary at the date of death; and
  • the amount of pension you would have received had you remained in pensionable service until normal pension age, but based on your final pensionable salary at the date of death, less any GMP payable.

Death before your deferred pension starts

If you die and have a deferred pension, the following benefits are payable:

A dependant's pension

Your qualifying spouse or qualifying civil partner will receive a dependant's pension calculated as follows:

  • It will be half of the pension you would have received if you had taken it immediately before the date of your death (ignoring any reduction there would normally have been for early payment).
  • If you have no qualifying spouse or qualifying civil partner, your nominated dependant will receive a pension. A pension paid to a nominated dependant will be reduced by any GMP payable and will not be payable if there are two or more qualifying children

Children's pensions

If a pension is payable to a qualifying spouse or a qualifying civil partner your qualifying children (up to a maximum of two) will receive between them a pension equal to a quarter of the pension you would have received if you had taken it immediately before the date of your death for each qualifying child (ignoring any reduction there would normally have been for early payment).

If no qualifying spouse or qualifying civil partner's pension is payable, the children's pensions will be the lesser of:

  • a pension for each qualifying child (up to a maximum of two) of one half of your pension you would have received if you had taken it immediately before the date of death (ignoring any reduction there would have been for early payment); and
  • the amount of pension you would have received if you had taken it immediately before the date of your death (ignoring any reduction there would have been for early payment), less any GMP payable.

A lump sum

If no pensions are payable, the Trustees will make a lump sum payment, which is currently free of inheritance tax. It will be equal to five times your deferred pension, with increases, to the date of your death.

The Trustees have discretion over who receives the cash and in what proportion. They take into account, but cannot be bound by, your wishes. You are therefore asked to let the Trustees know your choice of beneficiaries by keeping your expression of wish form up to date.

Death after your pension starts

Your pension is payable for life. On your death, the following benefits are payable:

A dependant's pension

Your qualifying spouse or qualifying civil partner will receive a dependant's pension it will be half of you full pension with increases to the date of your death.

If you have no qualifying spouse or qualifying civil partner, your nominated dependant will receive a pension. A pension paid to a nominated dependant will be reduced by any GMP payable and will not be payable if there are two or more qualifying children

Example:

John retires at age 60. His annual pension is £12,000. He exchanges some of his pension for a cash lump sum and receives a lower pension. He nominates his partner, Janet, as his dependant.

Following John's death, Janet will receive a pension of £6,000 pa for the rest of her life.

Children's pensions

Your qualifying children (up to a maximum of two) will receive a pension equal to a quarter of your full pension. If no qualifying spouse or qualifying civil partner's pension is payable, the children's pensions will be doubled. (subject to a combined maximum of your full pension less any GMP)

A lump sum

If you die within five years of your pension starting the Trustees will make a lump sum payment. It will be equal to the pension payments you would have received for the remainder of the five years at the rate payable immediately before your death, ignoring any levelling adjustment.

Alternatively, if you are being paid an incapacity and die any time before normal pension age, the Trustees will make a lump sum payment. It will be equal to four times your pensionable salary (ignoring the earnings cap) as at the date you left service, less any cash you took in exchange for pension (see Commutation.)

Lump sum payments are currently free of inheritance tax. The Trustees have discretion over who receives the cash and in what proportion. They take into account, but cannot be bound by, your wishes. You are therefore asked to let the trustees know your choice of beneficiaries by keeping your expression of wish form up to date.

Divorce or dissolution of a civil partnership

Pension rights may be taken into account on divorce or dissolution of a civil partnership. The court can order your pension to be divided between you and your ex-partner (ie your former spouse or civil partner), although whether this happens depends on the terms of the settlement.

Couples can choose to offset pension rights against other assets (eg the family home) or 'earmark' some (or all) of a member's benefits to go direct to your ex-partner when they come into payment. Alternatively, pension rights can be 'shared' as part of a 'clean break' settlement. Pension sharing creates a 'pension credit' for the ex-partner and a corresponding 'pension debit' for the member.

The scheme makes a charge for:

  • providing information in connection with divorce proceedings, over and above that which it has a duty to provide free of charge under the existing statutory disclosure requirements;
  • compliance with a pension sharing order or agreement; and
  • any other activities in connection with pension sharing.

A more detailed explanation of pension sharing, how the scheme operates a pension sharing order or agreement, and a schedule of its charges are available from the pension service line.

You should consult and be guided by a suitably qualified family law practitioner on matters relating to divorce or dissolution of a civil partnership.