NHS pension transfers
Since over 1.5 million people in the UK are employed by the National Health Service (NHS), it comes as no surprise that pensions advisors often hear from customers with NHS pensions who want to know whether they can transfer their pot elsewhere, or explore other options having been told that this is not possible.
To answer these questions and more, we’ve put together this guide where you’ll find information on the following topics:
- Can I transfer my NHS pension to another pension scheme?
- Transferring an NHS pension from England to Scotland
- How do I work out the cash equivalent transfer value?
- Where else can I transfer to?
- Can I transfer my NHS pension into a SIPP?
- Should I transfer my pension?
- How do I transfer my pension?
- Leaving early and transferring out
- Can I transfer into an NHS pension?
- Speak to an expert
Can I transfer my NHS pension to another pension?
Transferring out of an NHS pension can be fairly difficult due to the health service not allowing transfers to pension schemes with flexible benefits. You may only transfer to another defined benefit scheme (like for like) unless you have less than two years’ employed membership.
Can I transfer my NHS pension from England to Scotland and vice versa?
This is possible, though your benefits won’t automatically be carried across.
Transferring from England to Scotland
It is important to note that if you have been a member of an NHS pension scheme elsewhere in the UK your benefits will not transfer automatically to the Scottish Public Pensions Agency (SPPA).
If you would like to transfer your pension you would have to apply for the transfer of benefits. You will need to fully complete and return a Joiner Questionnaire form before the SPPA will investigate any transfer.
Transferring from Scotland to England
NHS Scotland has its own scheme run independently from the NHS in England and Wales. If you move from the NHS in Scotland to the NHS in England your benefits will not automatically transfer with you. If you would like to transfer your pension you would have to apply for the transfer of benefits. The scheme you would be transferred into would depend on how long ago you left NHS Scotland and what scheme you were in.
How do I work out my NHS pension transfer value?
If you do decide to transfer out of your NHS pension scheme, the trustees who run the scheme convert the benefits you’ve built up into a cash sum. This is called the pension cash-equivalent transfer value (CETV) or just ‘transfer value’.
Pension transfer value calculator
There’s a broad range of transfer values available (typically between 20-25 times your pensionable income), but keep in mind that some schemes provide transfer values greater than double other schemes. This reflects the wide range of methods used by pension scheme administrators to calculate transfer values.
The NHS Business Services Authority (NHSBSA) will usually give the CETV amount on the annual statement but you can also request it at any time.
There is an NHS pension transfer value calculator that you can use on the NHSBSA’s website, but speaking to an independent pensions advisor before making any decisions based on the numbers it returns is recommended.
NHS pension cash equivalent transfer value for a divorce
For an NHS pension transfer for a divorce, a member must complete a Pensions on divorce Cash Equivalent Transfer Value form (PD2).
The completed form Cash Equivalent Transfer Value (PD2) should be returned and will form part of the request to NHS Pensions for a Cash Equivalent Transfer Value for divorce proceedings.
Members are entitled to one Cash Equivalent Transfer Value per year for any purpose. They must confirm if the Cash Equivalent Transfer Value is for divorce proceedings and it is important to let NHS Pensions know if a court date has been set.
Where else can I transfer my NHS pension to?
Transfers out of an NHS pension to personal pension schemes can be fairly limited due to them not allowing transfers into schemes with flexible benefits. All transfers must be to a defined benefit pension scheme unless you have only been a member of said NHS scheme for less than two years.
Transfer to a SIPP
You may be allowed to do a pension transfer from the NHS to a SIPP if you only have two years or less NHS pension membership.
Transfer to local government
This option is available to people who have voluntarily moved positions from employment in public health to being employed by the local government. Your transfer would be covered by the Public Sector transfer club allowing you to broadly maintain the equivalent credits regardless of any salary increase, meaning any final salary pension entitlements remain unchanged.
Should I transfer an NHS pension?
Any potential advantages of transferring from a defined benefit pension scheme like the NHS pension scheme to a personal pension scheme (defined contribution) are often outweighed by the potential costs and risks.
Your future pensionable income can’t be predicted with any certainty if you transfer out of a defined benefit scheme.
Transferring an NHS pension to another defined benefit scheme like with local government however is covered by the Public Sector transfer club so you would maintain the benefits already built up.
To get the best advice for your circumstances you should speak with an expert pension advisor, like the ones we work with. Call us on 0808 189 0463 or make an enquiry.
How do I transfer my pension?
If you have found an alternative defined benefit pension scheme that you want to transfer your NHS pension to you must:
- Join your new registered scheme within 12 months of leaving pensionable NHS employment.
- Apply for a transfer within 12 months of joining your new scheme.
- Complete the transfer before you reach normal retirement age.
If you meet the above criteria you must fill out a pension transfer application pack, but before doing so it would be prudent to speak with an expert pensions advisor, like the ones we work with to seek independent advice for your circumstances.
Leaving early and transferring out
Due to the sheer amount of people affected by the NHS pension scheme the NHSBA have put together a comprehensive guide detailing leaving and transferring out of the scheme, but for bespoke advice you can make an enquiry to speak to an independent pensions advisor.
Can I transfer a private pension into my NHS pension?
Yes. This could be possible. Transferring your personal pension into the NHS scheme can be an easy process if you meet the following qualifying criteria:
‘Within 12 months of becoming eligible to join the scheme for the first time and before your Normal Pension Age which is equal to your State Pension Age, or 65 if that’s later.’
If you do meet the above criteria and you wish to transfer an old pension into a new NHS pension scheme then you will be required to fill out an application and return it to the NHSBA (National Health Service Business Service Authority) administrators.
Can I transfer my local government pension to the NHS pension scheme?
This option is available to people who have voluntarily moved positions from local government to public health. Your transfer would be covered by the Public Sector transfer club, allowing you to broadly maintain the equivalent credits regardless of any salary increase, meaning any final salary pension entitlements remain unchanged.
Should I transfer into my NHS pension?
If you have another pension pot besides your NHS one, most experts would recommend consolidating the funds in your NHS scheme for easier management. This could potentially mean paying less fees too.
Before making this decision, be sure to speak to an independent financial advisor because it’s impossible for us to provide bespoke information on this subject without assessing your needs, circumstances and all of the options available to you.
Get advice from an expert
If you have questions about NHS pension transfers or pensions in general and want to speak to an expert for the right advice, call us on 0808 189 0463 or make an enquiry here.