Breaking - RMPP RMSPS - update on tax- 18 1st June application for winter payment 2020, diary time line

[renrag40]

Hi Stephen, great to see that your maximum tax free lump sum is higher than both you and I worked out...... RESULT!

[renrag40]

Steph, I’m a bit confused..... just to clarify...... your DBCBS reduction of 8%....... shouldn’t that be for taking it early by 5 years 2 months? So, it is a reduction of about 1.5% per year?
Ps I’d just like to thank you for your openness and candour in providing the rest of us with a step by step guide to the process and the full disclosure of your figures. You didn’t have to do it but you chose to so to help others. It has been very instructive and helpful in trying to understand the Byzantine workings of our pensions. Thank you.

[RobertT]

Have you added on the 3.7% increase on the first years worth of DBCBS, or factored in the 2019 pay rise, meaning the second years DBCBS was higher then the first?

I presume these may be there as these are from the almost final benefit options I have been given.
Th £5750 is shown on my 2019 statement, we haven't had a 2020 one yet and the 2020 to 2021 (7 months) .
But the figures I have given are from the benefit options I have been given up to 1st Nov 2020, subject to revision.
They say they will give me a more up to date version, just before payment.

I was referring to these figures:

For 2018 I earned £5750 DBCBS
2019 £5750 DBCBS
2020 £3441 DBCBS 7 months Apr till end of Oct
Total DBCBS £14941

The 2018/19 amount would be £5,750 + 3.7%
The 2019/20 and 2020/21 amounts, you can work out from your regular weekly/monthly pension payments on your payslip, as we haven't had a pay rise since April 2019.

No need to guess or wait for the 2020 statement.

[stephen500]

Steph, I’m a bit confused..... just to clarify...... your DBCBS reduction of 8%....... shouldn’t that be for taking it early by 5 years 2 months? So, it is a reduction of about 1.5% per year?
Ps I’d just like to thank you for your openness and candour in providing the rest of us with a step by step guide to the process and the full disclosure of your figures. You didn’t have to do it but you chose to so to help others. It has been very instructive and helpful in trying to understand the Byzantine workings of our pensions. Thank you.

I only worked the reduction quickly using microsoft calculation and actually, in hindsight just divided it up by 2.7 years, which is the time I have been in the DBCBS ny Nov 2020. It should have been 67 months and works out around 1.4% reduction per year, provided that is my final figure for DBCBS and they have calculated up to Nov 2020. The DBCBS could be higher means my reduction figure here of 1.4% reduction would be wrong again.

[stephen500]

Have you added on the 3.7% increase on the first years worth of DBCBS, or factored in the 2019 pay rise, meaning the second years DBCBS was higher then the first?

I presume these may be there as these are from the almost final benefit options I have been given.
Th £5750 is shown on my 2019 statement, we haven't had a 2020 one yet and the 2020 to 2021 (7 months) .
But the figures I have given are from the benefit options I have been given up to 1st Nov 2020, subject to revision.
They say they will give me a more up to date version, just before payment.

I was referring to these figures:

For 2018 I earned £5750 DBCBS
2019 £5750 DBCBS
2020 £3441 DBCBS 7 months Apr till end of Oct
Total DBCBS £14941

The 2018/19 amount would be £5,750 + 3.7%
The 2019/20 and 2020/21 amounts, you can work out from your regular weekly/monthly pension payments on your payslip, as we haven't had a pay rise since April 2019.

No need to guess or wait for the 2020 statement.

Currently if I look at my payslip and find 19.6% of my pensionable pay and x it by 52, I get £5900. Although the problem is that DBCBS pensionable pay is slightly different to final salary pensionable pay and I am not sure what my pensionable pay on the pay slip represents ie final salary or DBCBS? (2019 illustration £28,833 pensionable pay, Cash balance pensionable pay £29203 (this comes in spot on at £5724) If I take the figure from the pay slip, it indicates my DBCBS as £5900 this year (pro rata divided by 12 x 7 till Nov 2020) but I don't know if this pay slip figure is final salary or DBCBS? However even the crudest workings out indicate that the reduction for taking the DBCBS certainly appears to be much less than the 5% per year, than the normal FS and CSDB schemes normally work at? Your thoughts Robert T?

[stephen500]

Steph, I’m a bit confused..... just to clarify...... your DBCBS reduction of 8%....... shouldn’t that be for taking it early by 5 years 2 months? So, it is a reduction of about 1.5% per year?
Ps I’d just like to thank you for your openness and candour in providing the rest of us with a step by step guide to the process and the full disclosure of your figures. You didn’t have to do it but you chose to so to help others. It has been very instructive and helpful in trying to understand the Byzantine workings of our pensions. Thank you.

I wanted to help others in the process, however part of me was worried that others on much less pensions than me, would think me boastful.
I am sorry that many others, particually delivery postmen and women on days have inferior pensions. I wish it was not so. However I can't help the fact, that I work nights and have PHG reserved rights. Sad to think, we are all working for the same firm, whilst those working around me, do so for inferior pensions and pay.
It's like the house we own. I have no mortgage and my mortgage was £22,500 in 1987. I now do not have to pay rent or mortgage payments on my retirement income. Others sadly have to find £700 per month out of their pension for their rent? We had it good and the only way to begin to make it better, is to get rid of this Tory government and demand change, a new deal.

[freespeech]

Currently if I look at my payslip and find 19.6% of my pensionable pay and x it by 52, I get £5900. Although the problem is that DBCBS pensionable pay is slightly different to final salary pensionable pay and I am not sure what my pensionable pay on the pay slip represents ie final salary or DBCBS? (2019 illustration £28,833 pensionable pay, Cash balance pensionable pay £29203 (this comes in spot on at £5724) If I take the figure from the pay slip, it indicates my DBCBS as £5900 this year (pro rata divided by 12 x 7 till Nov 2020) but I don't know if this pay slip figure is final salary or DBCBS? However even the crudest workings out indicate that the reduction for taking the DBCBS certainly appears to be much less than the 5% per year, than the normal FS and CSDB schemes normally work at? Your thoughts Robert T?

Final salary pensionable pay is basic pay plus shift allowances minus the lower earnings limit (currently £3328pa). Cash balance pensionable pay would also include any pensionable bonuses.

[stephen500]

So my benefit figures (subject to revision) set aside my original projections!
Let's see how I fared?

my projection.jpg

NRA 60 RMSPS pension : I said £8209.32. It was £9577.33
NRA 65 RMSPS pension ; I said £749.60. It was £519.54
NRA 65 RMPP pension: I said £2248.80. It was £1751.32
So I said total pensions of £11,207.72 and it actually is £11,849.13
So as you can see the sub totals were out, but the total figures, I was nearly spot on!
However the same cannot be said of the lump sums!
NRA 60/65 RMSPS my estimate £59725. It was £67312.46
NRA 65 RMPP with DBCBS I said £18282 before a tax reduction of £3290. It was £19544.16 before a tax reduction of £1179.80
So I estimated Lump sums of £77349 whereas the actual final figures (subject to revision) was £85,676.82 after tax.
Only £8327.82 out, glad to say to my benefit!
Note the excess DBCBS is classed as "an uncrystallised funds pension lump sum" and that figure still has a 25% tax free allowance (on top of your 25% tax free allowance for FS and CSDB (including the tax free DBCBS that you can include in your CSDB to take you up to the max 25% allowance) and it is only 75% of the excess DBCBS that is subject to tax at your tax rate (which is probally 20%)

[stephen500]

deleted

[RobertT]

Currently if I look at my payslip and find 19.6% of my pensionable pay and x it by 52, I get £5900. Although the problem is that DBCBS pensionable pay is slightly different to final salary pensionable pay and I am not sure what my pensionable pay on the pay slip represents ie final salary or DBCBS? (2019 illustration £28,833 pensionable pay, Cash balance pensionable pay £29203 (this comes in spot on at £5724) If I take the figure from the pay slip, it indicates my DBCBS as £5900 this year (pro rata divided by 12 x 7 till Nov 2020) but I don't know if this pay slip figure is final salary or DBCBS? However even the crudest workings out indicate that the reduction for taking the DBCBS certainly appears to be much less than the 5% per year, than the normal FS and CSDB schemes normally work at? Your thoughts Robert T?

The pensionable pay figure on your payslip is otherwise known as your 'pensions contrib pay'. Multiply that by 52 and you'll get your yearly figure.

Final salary pensionable pay relates to those benefits you earned up to 2008, but you're currently paying into the DBCBS, so DBCBS pensionable is obviously the figure used. You can check the definitions on your annual illustration.

Therefore work out 19.6% of your pensions contrib pay and multiply by 52 and you'll get your yearly DBCBS value for 2019/20. Multiply by the appropriate number of weeks for the pro rata amount for 2020/21.

I hope that helps.

[RobertT]

Final salary pensionable pay is basic pay plus shift allowances minus the lower earnings limit (currently £3328pa). Cash balance pensionable pay would also include any pensionable bonuses.

The LED applies to section C & F members of the RMPP. It doesn't apply to section A or B. Stephen is in section B.

[stephen500]

Currently if I look at my payslip and find 19.6% of my pensionable pay and x it by 52, I get £5900. Although the problem is that DBCBS pensionable pay is slightly different to final salary pensionable pay and I am not sure what my pensionable pay on the pay slip represents ie final salary or DBCBS? (2019 illustration £28,833 pensionable pay, Cash balance pensionable pay £29203 (this comes in spot on at £5724) If I take the figure from the pay slip, it indicates my DBCBS as £5900 this year (pro rata divided by 12 x 7 till Nov 2020) but I don't know if this pay slip figure is final salary or DBCBS? However even the crudest workings out indicate that the reduction for taking the DBCBS certainly appears to be much less than the 5% per year, than the normal FS and CSDB schemes normally work at? Your thoughts Robert T?

The pensionable pay figure on your payslip is otherwise known as your 'pensions contrib pay'. Multiply that by 52 and you'll get your yearly figure.

Final salary pensionable pay relates to those benefits you earned up to 2008, but you're currently paying into the DBCBS, so DBCBS pensionable is obviously the figure used. You can check the definitions on your annual illustration.

Therefore work out 19.6% of your pensions contrib pay and multiply by 52 and you'll get your yearly DBCBS value for 2019/20. Multiply by the appropriate number of weeks for the pro rata amount for 2020/21.

I hope that helps.

Thanks it did. It works out for 2020/21 at approx £5900 per annum.

[stephen500]

receipt long for final return RMPP.jpg

receipt long for final return RMSPS.jpg

Final pension benefit letter returned and received at both pension centres.
Applications start 1st June, now 28th July, pension due 1st Nov 2020.
Now I wait.

[stephen500]

Um, I have given them 6 months notice to get my pension in Nov and leave RM in December.
I just spoke to Capita as the RMSPS is the pension that always seems to be paid after the RMPP.
From what I was told this will ALWAYS be the case. The RMSPS (Capita) pension CANNOT be paid until RMSPS have received a "trigger" from RMPP, stating that they are about to pay the RMPP pension.
That trigger takes a small amount of time and checking has to then take place.
Which means that if the "trend" followed for me, I could expect payment of my lump sum by RMSPS about 15 days at least after my RMPP payment date, leaving just enough time to get my first pension payment of 30th November.
RMSPS told me that cannot do any thing about RMPP sending this trigger and cannot pay until they receive it.
This makes RMSPS (Capita) look bad and RMPP look fantastic.
RMSPS did not suggest this was deliberate, but just a by product of the system in place.
Worst problems, to me, tend to be Avcs causing delays. I don't have any.

[tractorboy2]

Is there a definitive answer to the question that has been raised on these threads a few times regarding how much you lose for taking the DBCBS early ? The RMPP site doesn't say.