Accrual Rate<\/strong> Active Member<\/strong> Actuarial Reduction<\/strong> Actuarial Valuation<\/strong> Actuary<\/strong> A-Day<\/strong> Added Years<\/strong> Additional Pension<\/strong> Additional Voluntary Contribution (AVC)<\/strong> Alternatively Secured Pension (ASP)<\/strong> Annual Allowance (AA)<\/strong> Annual Management Charge (AMC)<\/strong> Annuity<\/strong> Basic State Pension<\/strong> Career Average Revalued Earnings (CARE) Scheme<\/strong> Cash Equivalent Transfer Value (CETV)<\/strong> Class 1 National Insurance Contribution<\/strong> Class 2 National Insurance Contribution<\/strong> Class 3 National Insurance Contribution<\/strong> Class 4 National Insurance Contribution<\/strong> Closed Scheme<\/strong> Combined Pension Forecast (CPF)<\/strong> Commutation Factor<\/strong> Concurrency<\/strong> Contracted-Out Deduction (COD)<\/strong> Contracted-Out Employments Group (COEG)<\/strong> Contracting Out<\/strong> Crystallisation Event<\/strong> Deferred Member<\/strong> Deferred Pension<\/strong> Defined Benefit (DB) Scheme<\/strong> Defined Contribution (DC) Scheme<\/strong> Department for Work and Pensions (DWP)<\/strong> Dependant<\/strong> Early Leaver<\/strong> Early Retirement<\/strong> Earmarking<\/strong> Employer Access<\/strong> Employer Funded Retirement Benefit Scheme (EFRBS)<\/strong> Enhanced Protection<\/strong> Equivalent Pension Benefit (EPB)<\/strong> Escalation<\/strong> Executive Pension Scheme (EPP)<\/strong> Expression of Wish<\/strong> Final Salary Scheme<\/strong> Financial Assistance Scheme (FAS)<\/strong> Financial Services Authority (FSA)<\/strong> Financial Services Compensation Scheme (FSCS)<\/strong> Fraud Compensation Fund (FCF)<\/strong> Free-Standing Additional Voluntary Contribution (FSAVC)<\/strong> Funded Unapproved Retirement Benefits Scheme (FURBS)<\/strong> Group Personal Pension Plan (GPP)<\/strong> Guaranteed Minimum Pension (GMP)<\/strong> Home Responsibilities Protection (HRP)<\/strong> Hybrid Scheme<\/strong> Ill Health Early Retirement<\/strong> Impaired Life Annuity<\/strong> Income Drawdown (now known as Capped Drawdown)<\/strong> Income Withdrawal<\/strong> Late Retirement<\/strong> Lifestyling<\/strong> Lifetime Allowance (LA)<\/strong> Limited Price Index (LPI)<\/strong> Lump Sum<\/strong> Market Value Reduction (MVR)<\/strong> Money Purchase Scheme<\/strong> National Employment Savings Trust (NEST)<\/strong> National Insurance Contribution (NIC)<\/strong> National Insurance Contributions Office (NICO)<\/strong> Normal Retirement Age (NRA)<\/strong> Normal Retirement Date (NRD)<\/strong> Occupational Pension Scheme<\/strong> Offsetting<\/strong> Open Market Option (OMO)<\/strong> Paid Up<\/strong> Pension Commencement Lump Sum (PCLS)<\/strong> Pension Credit<\/strong> Pension Earmarking<\/strong> Pension Guarantee<\/strong> Pension Offsetting<\/strong> Pension Protection Fund (PPF)<\/strong> Pension Sharing<\/strong> Pension Simplification<\/strong> Pensionable Salary<\/strong> Pensionable Service<\/strong> Personal Pension Plan (PPP)<\/strong> Preserved Member<\/strong> Preserved Pension<\/strong> Protected Rights (PR)<\/strong> Qualifying <\/strong> Qualifying Year<\/strong> Record of Payments Due<\/strong> Retail Price Index (RPI)<\/strong> Retirement Annuity Contract (RAC)<\/strong> Revaluation<\/strong> Salary Sacrifice<\/strong> Salary-Related Scheme<\/strong> Schedule of Contributions<\/strong> Section 32 Plan<\/strong> Selected Pension Age (SPA)<\/strong> Self-Invested Pension Plan (SIPP)<\/strong> Short-Term Annuity<\/strong> Small Self-Administered Scheme (SSAS)<\/strong> Stakeholder Designation<\/strong> Stakeholder Pension Scheme<\/strong> State Additional Pension<\/strong> State Earnings-Related Pension Scheme (SERPS)<\/strong> State Graduated Pension Scheme<\/strong> State Pension<\/strong> State Pension Age (SPA)<\/strong> State Pension Date (SPD)<\/strong> State Pension Deferral<\/strong> State Pension Forecast<\/strong> State Second Pension (S2P)<\/strong> Tax Relief<\/strong> Tax-Approved Scheme<\/strong> The Pension Service<\/strong> The Pensions Advisory Service (TPAS)<\/strong> The Pensions Regulator (TPR)<\/strong> Transitional Protection<\/strong> Unfunded Unapproved Retirement Benefits Scheme (UURBS)<\/strong> Unsecured Pension<\/strong> Winding Up<\/strong> Winding Up Priority Order<\/strong> Understanding the jargon Accrual Rate The factor used to calculate benefits in a defined benefit scheme. For example, a scheme with an accrual rate of 1\/60th will provide 1\/60th of pensionable salary for each year of pensionable service.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"_links":{"self":[{"href":"https:\/\/www.suretyfp.com\/wordpress\/index.php?rest_route=\/wp\/v2\/posts\/1299"}],"collection":[{"href":"https:\/\/www.suretyfp.com\/wordpress\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.suretyfp.com\/wordpress\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.suretyfp.com\/wordpress\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.suretyfp.com\/wordpress\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1299"}],"version-history":[{"count":0,"href":"https:\/\/www.suretyfp.com\/wordpress\/index.php?rest_route=\/wp\/v2\/posts\/1299\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.suretyfp.com\/wordpress\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1299"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.suretyfp.com\/wordpress\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1299"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.suretyfp.com\/wordpress\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1299"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\nThe factor used to calculate benefits in a defined benefit scheme. For example, a scheme with an accrual rate of 1\/60th will provide 1\/60th of pensionable salary for each year of pensionable service.<\/p>\n
\nAn occupational pension scheme member who is earning new defined benefit scheme benefits or paying defined contribution scheme contributions.<\/p>\n
\nA reduction made to a pension paid early to the member of a defined benefit scheme.<\/p>\n
\nAn assessment of a defined benefit scheme\u2019s ability to meet its liabilities. Carried out by the scheme actuary at least once every three years.<\/p>\n
\nThe individual appointed by the trustees of an occupational pension scheme to carry out valuations and advise on funding matters.<\/p>\n
\n6 April 2006 \u2013 the effective date of pension\u2019s simplification, when HMRC introduced a single tax regime for all UK pension schemes.<\/p>\n
\nA provision of some defined benefit scheme for building extra pensionable service in return for additional contributions.<\/p>\n
\nThe earnings-related part of the State pension paid in addition to the basic State pension.<\/p>\n
\nA facility provided by occupational pension schemes for members to boost retirement savings.<\/p>\n
\nAllowed a pension scheme member to defer purchasing an annuity at age 75. A defined level of income could be drawn on the invested funds until the member decides to purchase an annuity or dies.<\/p>\n
\nThe maximum pension input (earned in a defined benefit scheme and contributions paid into a defined contribution scheme) a pension scheme member is allowed each year without giving rise to a tax charge.<\/p>\n
\nThe administration fee levied each year on a defined contribution scheme, a personal pension plan or a Stakeholder pension scheme.<\/p>\n
\nA policy that provides an income in retirement.<\/p>\n
\nThe benefit provided at State pension age to those with a sufficient National Insurance Contribution record.<\/p>\n
\nA type of defined benefit scheme that calculates retirement benefits using the average of revalued pensionable salaries over the member\u2019s pensionable service.<\/p>\n
\nThe amount offered to a member of an occupational pension scheme who wants to transfer to another pension scheme.<\/p>\n
\nContribution paid by the employed (not self-employed), calculated as a percentage of pay.<\/p>\n
\nFlat-rate contribution paid by the self-employed.<\/p>\n
\nVoluntary contribution paid to improve basic State pension entitlement.<\/p>\n
\nProfit-based contribution paid by the self-employed in addition to the Class 2 contribution.<\/p>\n
\nAn occupational pension scheme where the membership is no longer open to new employees.<\/p>\n
\nA Statement that shows both estimated pension scheme and State pension benefits. Issued voluntarily by pension schemes.<\/p>\n
\nUsed to calculate how much pension from a defined benefit scheme is given up in exchange for a tax-free lump sum.<\/p>\n
\nThe principle allowing someone to pay into more than one pension scheme at the same time.<\/p>\n
\nThe deduction applied to a person\u2019s SERPS entitlement for the period they were contracted out between 1978 and 1997.<\/p>\n
\nA part of the DWP, it administers pension scheme members\u2019 contracting out records.<\/p>\n
\nThe facility to opt out of the State additional pension and build up benefits in a pension scheme.<\/p>\n
\nAn event where pension benefits become payable, i.e. annuity purchase, death, starting an unsecured pension etc, and at which time a test against the Lifetime Allowance is carried out.<\/p>\n
\nAn occupational pension scheme member who has left service with a deferred pension or fund.<\/p>\n
\nThe benefit awarded to a defined benefit scheme member who has left service early..<\/p>\n
\nAn occupational pension scheme that provides benefits based on accrual rate, pensionable service and pensionable salary.<\/p>\n
\nA scheme that provides retirement benefits based on the build up of a \u2018pot\u2019 of money, accumulated through the investment of contributions paid by both the employee and the employer.<\/p>\n
\nThe Government department with overall responsible for the rules governing pension schemes and the administration of the State pension.<\/p>\n
\nAn individual who is eligible to receive retirement benefits, i.e. pension and\/or lump sum, following the death of a pension scheme member.<\/p>\n
\nAn occupational pension scheme member who leaves service before reaching their normal retirement age.<\/p>\n
\nThe payment of retirement benefits from a pension scheme before a member\u2019s normal retirement date.<\/p>\n
\nProvides a spouse with a share of a pension scheme member\u2019s pension rights on divorce. Spouse\u2019s share is paid when the member draws their benefits.<\/p>\n
\nEmployers with five or more staff but with no pension arrangement in place must designate a Stakeholder pension scheme and offer access to qualifying employees.<\/p>\n
\nPreviously known as FURBS and UURBS. These are unapproved schemes with no tax reliefs that an employer funds to provide a member with a lump sum and\/or income.<\/p>\n
\nIf a member is worried their pension rights exceed, or may exceed, the Lifetime Allowance, they can safeguard them against a tax charge.<\/p>\n
\nA non-revaluing pension built up while contracted out of the State graduated pension scheme through an occupational pension scheme.<\/p>\n
\nThe increments applied to a pension in payment.<\/p>\n
\nAn occupational pension scheme for selected directors and senior staff.<\/p>\n
\nNotification by a member to their pension scheme of how they wish their lump sum death benefits to be paid.<\/p>\n
\nAn occupational pension scheme that provides benefits based on accrual rate, pensionable service and pensionable salary.<\/p>\n
\nA Government-funded scheme, operated by the DWP, set up in 2005 to pay compensation to wound-up occupational pension scheme members who have lost pension rights following an employer\u2019s insolvency.<\/p>\n
\nAn independent, Government-funded body that regulates the financial services business in the UK.<\/p>\n
\nAn independent, levy-funded body that compensates consumers who cannot complete claims because their provider is insolvent.<\/p>\n
\nLevy funded and operated by the PPF, this fund compensates occupational pension schemes that have suffered financial injustice as a result of dishonesty.<\/p>\n
\nA facility provided by insurance companies for members to boost their occupational pension scheme savings.<\/p>\n
\nNow known as an EFRBS. These are unapproved schemes with no tax reliefs that an employer funds to provide a member with a lump sum and\/or income.<\/p>\n
\nA collection of personal pension plans provided by an employer to its staff.<\/p>\n
\nThe benefit built up in a defined benefit scheme as a result of being contracted out of the State additional pension.<\/p>\n
\nAvailable to carers and those looking after children, this benefit reduces the number of qualifying years required for the basic State pension.<\/p>\n
\nAn occupational pension scheme that calculates retirement benefits as some combination of two alternatives, defined benefit scheme or defined contribution scheme.<\/p>\n
\nIf an occupational pension scheme member is unable to work as a result of a medical condition, they may be entitled to draw retirement benefits early (sometimes enhanced) at any age (no later than 75).<\/p>\n
\nA\u00a0member of a defined contribution scheme\u00a0may be able to claim an immediate annuity on enhanced terms if they are suffering from poor health, such as high blood pressure, diabetes, heart condition, kidney failure, certain types of cancer, multiple sclerosis and chronic asthma.<\/p>\n
\nAlso previously known as an unsecured pension. Allows a pension scheme member to continue to invest a fund while drawing a limited income. Available to under 75s only.<\/p>\n
\nAlso known as an unsecured pension. Allows a pension scheme member to continue to invest a fund while drawing a limited income. Available to under 75s only.<\/p>\n
\nThe payment of retirement benefits from a pension scheme after a member\u2019s normal retirement date.<\/p>\n
\nAn investment strategy on defined contribution schemes where\u00a0a member\u2019s investments are switched automatically as they get older to more secure holdings, such as cash.<\/p>\n
\nThe maximum value of fund a pension scheme member can accumulate without incurring a tax charge.<\/p>\n
\nThe change in the Retail Price Index between 1 October and the following 30 September, capped at 5 per cent (from April 1997 to April 2005) and 2.5 per cent (since April 2005). Used by pension schemes for pension increases and revaluation.<\/p>\n
\nThe tax-free lump sum paid to a member of a pension scheme when their benefits come into payment.<\/p>\n
\nAn adjustment made to the value of a With-Profit fund to reflect the difference between the market and actuarial values of the fund.<\/p>\n
\nA scheme that provides retirement benefits based on the build up of a \u2018pot\u2019 of money, accumulated through the investment of contributions paid by both the employee and the employer.<\/p>\n
\nA\u00a0new, simple, low-cost pension scheme\u00a0to be introduced from 2012 as part of the workplace pension reforms.<\/p>\n
\nPayments deducted from pay or declared through self assessment, used by the DWP to fund the State pension and other State benefits.<\/p>\n
\nA part of HMRC. They administer the collection of National Insurance Contributions.<\/p>\n
\nThe contractual age at which retirement benefits are paid from an occupational pension scheme.<\/p>\n
\nThe date that an occupational pension scheme member reaches normal retirement age.<\/p>\n
\nA scheme set up by an employer to provide retirement and\/or death benefits to employees.<\/p>\n
\nA member\u2019s pension rights are offset against other assets as part of a divorce settlement.<\/p>\n
\nA provision of defined contribution schemes allowing members to transfer funds at retirement to draw an immediate annuity with another provider.<\/p>\n
\nThe status given to a personal pension plan when a member chooses to cease contributing.<\/p>\n
\nThe tax-free lump sum paid to a member of a pension scheme when their benefits come into payment.<\/p>\n
\nA means-tested benefit that boosts a pensioner\u2019s State pension to ensure they have a minimum level of income.<\/p>\n
\nProvides a spouse with a share of a pension scheme member\u2019s pension rights on divorce. Spouse\u2019s share is paid when the member draws benefits.<\/p>\n
\nIncorporated into a pension once put into payment. It ensures that pension instalments for a specified period are paid, even if the member dies before the period expires.<\/p>\n
\nA member\u2019s pension rights are offset against other assets as part of a divorce settlement.<\/p>\n
\nAn independent, levy-funded body that compensates members of occupational pension schemes who have lost pension benefits as a result of an employer\u2019s insolvency.<\/p>\n
\nProvides a spouse with a share of a pension scheme member\u2019s retirement benefits on divorce. Spouse is given a credit to put towards his or her own retirement benefits.<\/p>\n
\nThe name given to the changes introduced by HMRC on A-Day. One single tax regime was introduced to replace the previous eight.<\/p>\n
\nEarnings used to calculate retirement benefits in a defined benefit scheme.<\/p>\n
\nLength of qualifying time in a defined benefit scheme used to calculate retirement benefits.<\/p>\n
\nA type of defined contribution scheme. Provides retirement benefits based on the build-up of a \u2018pot\u2019 of money, accumulated through the investment of contributions.<\/p>\n
\nAn occupational pension scheme member who has left service with a preserved pension or fund.<\/p>\n
\nThe benefit awarded to a defined benefit scheme member who has left service early.<\/p>\n
\nThe fund built up in a defined contribution scheme from rebates paid as a result of being contracted out of the State additional pension.<\/p>\n
\nRecognised Overseas Pension Scheme (QROPS)
\nAn overseas pension scheme that meets HMRC\u00a0rules that allow overseas transfers.<\/p>\n
\nA year in which an individual has paid, or is treated as having paid, National Insurance contributions.<\/p>\n
\nProduced by an employer, it records how much they and their employees will contribute to the designated Stakeholder pension scheme.<\/p>\n
\nUsed by pension schemes to calculate pension increases. It is the average measure of change in the prices of goods and services bought in the UK.<\/p>\n
\nThe predecessor of the personal pension plan. Available before April 1988 to the self-employed and those in employment who did not have access to an occupational pension scheme.<\/p>\n
\nThe increase, normally in line with inflation, of a deferred pension between the date the member leaves service and their Normal Retirement Age (NRA).<\/p>\n
\nAn arrangement between an employer and an employee where the employee forgoes part of their pay for a corresponding employer contribution to the pension scheme.<\/p>\n
\nAn occupational pension scheme that provides benefits based on accrual rate, pensionable service and pensionable salary.<\/p>\n
\nProduced by the scheme actuary, it shows the trustees of a defined benefit scheme how much the employer and employees will contribute.<\/p>\n
\nAn insurance policy designed to accept transfers from defined benefit schemes.<\/p>\n
\nThe age chosen by a personal pension plan member to draw retirement benefits.<\/p>\n
\nA type of personal pension plan that gives an individual more investment control.<\/p>\n
\nA temporary annuity that runs for no longer than five years. Allows an individual to draw an income while deferring purchasing a full annuity.<\/p>\n
\nAn occupational pension scheme, usually for small businesses, that gives members more investment control.<\/p>\n
\nThe process followed by an employer who is not exempt from the employer access requirements. The employer must choose a Stakeholder pension scheme and provide access to their employees.<\/p>\n
\nA type of personal pension plan, offering a low-cost and flexible alternative and which must comply with requirements laid down in legislation.<\/p>\n
\nThe earnings-related part of the State pension, paid in addition to the basic State pension.<\/p>\n
\nAlternative name given to the State additional pension between April 1978 and April 2002.<\/p>\n
\nAlternative name given to the State additional pension between April 1961 and April 1975.<\/p>\n
\nAdministered and paid by The Pension Service, this benefit is made up of the basic State pension and the State additional pension.<\/p>\n
\nThe earliest age at which the State pension can be taken.<\/p>\n
\nThe earliest date that the State pension can be paid.<\/p>\n
\nOn reaching State pension age, a pensioner can defer taking their State pension in exchange for a higher pension or lump sum in the future.<\/p>\n
\nAn illustration provided by The Pension Service giving an estimate of what State pension an individual may receive at State pension age.<\/p>\n
\nAlternative name given to the State additional pension since April 2002.<\/p>\n
\nIncentive given to those contributing to pension schemes. The Government pays tax relief at the investor\u2019s highest marginal rate; that is, a basic rate taxpayer will receive 20 per cent tax relief, a higher rate tax payer 40 per cent and a 50 per cent tax payer 50 per cent relief of a member\u2019s gross contribution.<\/p>\n
\nA pension scheme that has been approved to operate by HMRC.<\/p>\n
\nA part of the DWP. Responsible for administering and paying the State pension.<\/p>\n
\nAn independent, Government-funded body that provides general information about pensions to the public and also helps resolve pension disputes through mediation and conciliation.<\/p>\n
\nA Government body that regulates the running of occupational pension schemes.<\/p>\n
\nComes in two forms \u2013 primary and enhanced. Allows an individual to protect accrued pension rights that may exceed the Lifetime Allowance, thereby avoiding a tax charge on the excess.<\/p>\n
\nNow known as an EFRBS. These are unapproved schemes with no tax reliefs that an employer funds to provide a member with a lump sum and\/or income.<\/p>\n
\nAlso known as Income Drawdown or income withdrawal. Allows a pension scheme member to continue to invest a fund while drawing a limited income. Available to under 75s only.<\/p>\n
\nThe process of terminating an occupational pension scheme, usually by transferring member\u2019s benefits to individual arrangements.<\/p>\n
\nThe order in which members\u2019 benefits are distributed on the winding up of a defined benefit scheme with an insolvent employer and a funding shortfall.<\/p>\n","protected":false},"excerpt":{"rendered":"