- Helping members of occupational pension schemes to better understand their benefits.

17th June 2019
:: Scheme Member | Drawing My Benefits | My Retirement Date | Pensioner members of a DB scheme

My Retirement Date – Pensioner Members
This Factsheet discusses some of the main issues you should be aware of which can impact upon your ‘pension age’ and Normal Retirement Date. 
It is written for people with a pension benefit currently in payment from a defined benefit scheme irrespective of whether your benefits started being paid at Normal Retirement Age or paid earlier through ‘ill-health’ or ‘early retirement’.  
This Factsheet looks at the major issues about your pension age and Normal Retirement Date that YOU should be thinking about when it comes to finalising your retirement planning. It is designed to help you think about various aspects of your pension age and how this could have a bearing upon your pension benefits. This Factsheet will have most relevance to you: 
  • if you have only recently started to take your pension benefits,
  • if you started to take your benefits before State Pension Age,
  • if you have yet to take some of your pension from another source.
Some of the points are more obvious than others, but they are all important.
So take a while to think about your pension age. If you are intending to get advice from a Financial Adviser this factsheet will highlight those issues you should expect to consider (and often many more).
For related issues see the other factsheets in the Module Drawing My Benefits
What is the meant by the term ‘pension age’?
From 6th April 2006 the term ‘pension age’ has been formally agreed by Her Majesty’s Revenue & Customs (HMRC) – the tax collecting part of Government.
The term ‘pension age’ refers to the age at which you can take your pension benefits. It doesn’t mean that this is the age at which you will get your benefits.
The Scheme Rules for your pension arrangements will determine the minimum and maximum age limits from which are allowed to draw your pension benefit.
What is the minimum pension age?
Until 5th April 2010, the current normal minimum pension age from a registered pension scheme is age 50.
On 6th April 2010, this rises to age 55 for everyone.
But remember that in terms of when you drew your pension benefit depended upon the Rules of your pension scheme, which may set their minimum age higher than this.
There are still specific rules that apply for ill-health. Some schemes will allow a member to start taking their pension benefits early if they become incapable of work due to ill health. The Scheme Rules will specify what circumstances this applies to.
A member of a pension scheme with a lower minimum pension age resulting from service before 6th April 2006, may be able to protect that right i.e. to continue to be able to draw benefits before age 50 (or before age 55 on or after 6th April 2010). If you have a lower minimum pension age you should contact your scheme administrators who will let you know whether your lower minimum pension age is protected.
What could I take at ‘pension age’?
Your Scheme Rules will have determined what pension benefit you could take and when you could start to take it.
Pension benefit may be offered in a variety of forms such as a cash lump sum, a pension, or both. You may be entitled to benefits from additional voluntary contributions as well.
When can I draw my pension benefits?
HMRC impose rules which registered pension schemes must conform to (most schemes are registered).
The date from which you can draw your pension benefit will depend upon the Rules of your pension scheme. If you are a member of several schemes the dates may be different. So, you may already have started receiving your pension from one scheme, but still have benefits from other schemes which you have not yet drawn.
Although the present earliest age retirement benefits can be taken is 50 (subject to Scheme Rules), for the vast majority of members in a defined benefit scheme, Normal Retirement Date will fall between the ages of 60-75.
There are exceptions to this such as ill-health.
Before 6th April 2006, some specific pension schemes were permitted to have a retirement date lower than 50, reflecting the nature of their members’ occupations (such as some professional sportsmen). This needed the prior approval of the Inland Revenue’s Pension Scheme Office, who produced the Occupational Pension Scheme Practice Notes which laid down the regulations of approved occupational pension schemes. If you had this right to retire before age 50, and it was an ‘unqualified’ right – that is, it does not depend on you being able to get final approval from the Trustees of the scheme or your employer for instance – then you may be able to protect this right after 6th April 2006. If this applies to you contact the administrators of your scheme.
From 6th April 2006, much more flexibility has been introduced into pension legislation, and your Scheme Rules will determine your minimum and maximum pension age.
What is meant by the term Normal Retirement Date?
Before 6th April 2006, pension schemes will have had written within their Rules a reference to Normal Retirement Date. This is important as it is the date at which you would normally have been expected to start to draw your pension benefits without the consent of the employer or the Trustees.
Even though legislation has been introduced to simplify pensions (most of which became effective from 6th April 2006) it is likely that pension schemes will continue to use Normal Retirement Date as a key date.
The age you are at your Normal Retirement Date is commonly referred to as your Normal Retirement Age.
If you are unsure what your Normal Retirement Date is, contact your pension scheme or scheme administrators who will be able to tell you.
Be careful as other phrases are commonly used such as and Scheme Retirement Age which sounds very much the same but can have different meanings for different pension schemes.
The definitions may vary slightly, or significantly, from scheme to scheme, so if you have more than one pension don’t assume the words will mean the same for each scheme.
Why is Normal Retirement Date important to me?
What your Normal Retirement Date is will depend upon the Scheme Rules.
It is usually (but not always) the earliest date at which you are entitled to draw the whole of your pension benefit without penalty.
Haven’t some schemes raised the Normal Retirement Date for their members?
There have been widely-reported cases in the media about pension schemes raising the Normal Retirement Date for their members although now that you have started drawing your benefits this would not usually affect you.
An exception to this would be if you have drawn your benefits early due to ill-health and your benefits are paid by an insurance policy (rather than out of the pension scheme). Under these circumstances it is possible (although very exceptional) that your Normal Retirement Date could be affected. Your pension scheme administrators would be able to tell you what you Normal Retirement Date is.
Did I have to stop work at my Normal Retirement Date?
From 6th April 2006 much more flexibility was introduced by HMRC in respect of when and how pension benefits can be taken.
More and more employers are embracing ‘flexible retirement’ to accommodate those employees wishing to work beyond what would otherwise have been a standard Normal Retirement Date.
Some of my colleagues had a different retirement age to me. Why?
Some pension schemes have more than one category of membership. Where there is more than one category, different pension ages or Normal Retirement Dates may apply.
Different categories of scheme membership could include, for example: 
  • ‘Works’
  • ‘Staff’
  • Managers
  • Senior Executives
  • Directors
In some cases, employers elect to run an entirely separate pension scheme for a particular section of its workforce.
Normal Retirement Dates may also differ between scheme members because of previous takeovers of the employer and/or mergers of the employers’ pension schemes. Therefore, it is never safe to assume that your Normal Retirement Date is the same as that of your work colleagues.
Are retirement ages the same for men and women?
Before 17th May 1990, most pension schemes operated different retirement ages for men and women - 65 for men and 60 for women was the most common example. A court case dealing with sex discrimination (Barber vs GRE at the European Court of Justice in 1990) made this practice illegal.
Since then, the pension age for all pension benefits (pension, cash lump sum, death benefit) has had to be ‘equalised’ for males and females. That is, retirement age must be the same for males and females, the entitlements must be the same, the formula used to calculate benefits must be the same and conditions of payment the same.
Pension benefit earned before the 17th May 1990 can remain unaffected by equalisation, so the terms applicable to those benefit may still apply.
If the membership of the scheme could only be of one gender (e.g. a scheme with only males or only females) no action was deemed necessary under ‘equalisation’.
Pension schemes that historically operated different retirement ages have had to accommodate the ruling. If you have accumulated pension benefits earned before 17th May 1990 they should have been ‘equalised’.
Some pension schemes (albeit only a minority) took no immediate action to equalise – instead choosing to wait until the first member reached retirement before revising their method of calculating benefits. With the passage of time most schemes should have equalised by now – but it is always wise to check if you have any doubt.
Will my pension benefit change now that payment has commenced?
Once payment of your pension has commenced you might normally expect to receive increases either on the anniversary of your retirement or on the payment date following some fixed date (say 6th April).
Increases to your pension in payment are called ‘escalation’.
Whether you receive any pension increases in payment (escalation) will depend upon the Scheme Rules although there are some pension increases that are legally required – but these depend upon the dates when you built up your pension benefit.
However, there are other possible changes that could affect your pension and you should investigate whether any of these would apply to you. This type of change to pension usually applies when the pension benefit starts being paid either: 
  • before Normal Retirement Date (as in Early Payment or payment on the grounds of ill-heath for example) or
  • before State Pension Age (e.g. if your Normal Retirement Date is 60, but your State Pension Age is 65).
These changes would happen at your Normal Retirement Age or State Pension Age.
Changes to your pension could also happen for a wide variety of reasons, such as the way your pension scheme deals with:  
  • equalising pension benefit for males and females. (See above and our Factsheet on Equal Treatment for more detail).
  • any takeovers and mergers that have happened.
  • any transferred-in pension benefit you may have made from another employer or pension arrangement.
In these situations different parts of your benefit might come into payment at different times and with different increases.
Will reaching State Pension Age affect my pension benefit?
One of the most common reasons for a change to pensions in payment occurs when a pension commences before State Pension Age.
This is because many pension schemes were designed to provide an overall level of income for the retiring member which included the expected State Pension.
If you have drawn your benefits before State Pension Age there may be amendments to the scheme pension in payment at this key age. So if you started to receive your pension before State Pension Age you should check to see whether any change will occur.
Your pension scheme should explain the reason for any change. Not all pension schemes make changes to pensions in payment but it is important to identify whether yours does, and if it does, whether it will apply to your benefits.
Unfortunately, changes to your pension in payment is an area that causes much confusion, more often than not because of the different terminology used by pension schemes which can be inconsistent between schemes, administrators and advisers.
Typical terminology for the main type of pension changes that occur to pension once in payment include temporary pension, supplementary pension, bridging pension, pension offset and pension reduction. If in doubt, ask for an explanation in writing from the administrator of how any change would impact upon your pension benefits.
Summary & Key Points
When making enquiries about your pension benefit it is very important that you make it clear that you are a pensioner member rather than an active member or a preserved member. Active, preserved and pensioner are different classes of membership of a pension scheme and any definitions and paragraphs contained within your Scheme Rules or scheme literature relating to any benefit may differ considerably between these categories.
On average, people change jobs every 5 to 6 years. It is possible therefore, that you will have more than one pension benefit. You may now be drawing your pension benefit from one scheme but have others where you have not yet reached pension age in that scheme. For each pension benefit you need to consider the following items: 
  • When reviewing your pension benefit you need to identify your ‘pension age’ or Normal Retirement Date.
  • Is your Normal Retirement Date the earliest age that you may draw your pension benefit (other than on ‘ill-health’ grounds):
    • without trustee consent?
    • without the sponsoring employer’s consent? (where there still is one)
    • wholly without reduction?
  • If you have pensionable service with effect from 17th May 1990, are retirement ages equal for males and females for service from that date?
  • Where you have pensionable service with effect from 17th May 1990, has your pension benefit been equalised (assuming there were both males and females in the scheme)?
  • When you draw you pension benefit is there any change to your pension in payment such as:
    • an additional pension (e.g. commencing at a later date)?
    • a temporary pension (e.g. payable between two dates)?
    • a reduction to your pension (e.g. a decrease to your pension)?
  • If your pension payments haven’t begun will your pension benefit commence
    • the month you reach your Normal Retirement Date?
    • the month after your reach your Normal Retirement Date?
    • some other date?
  • Keep informed. Your scheme may modify benefits and Rules. Legislation may change. Your circumstances may alter.
  • Rules differ from scheme to scheme and are wide and varied in content. Don’t assume that what applies to one of your pension schemes will necessarily apply to others that you may have.
  • HMRC impose rules which registered pension schemes must conform to.
People seldom have identical pensions and you should avoid drawing comparisons with colleagues whose circumstances may at first appear the same but could emerge as having significant differences.
This is not an authoritative document. Seek professional advice from an appropriately experienced and qualified adviser.
My Retirement Date v1.4 Pensioner
Last updated 23/09/2006
View our Glossary for definitions of the terms used in our Factsheets

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My Retirement Date - Pensioner Members
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