Frequently Asked Questions

Final salary active members

Retiring from the scheme

You’re getting ready to enjoy the benefits you’ve been building up in the Scheme. The great news is you can tailor your benefits to meet your needs when you retire! There are a number of options open to you when you come to take your RPS benefits.

The following questions and answers explain some of these. 

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What is my Normal Retirement Age (NRA)?

Your NRA is the age from which you can take your full pension benefits without any reduction factors applied for early retirement. NRAs vary between sections, but most are between 60 and 65. You may be able to take your benefits earlier than your sections NRA, but these will be reduced depending on how early you take them.

 

You can find ​details of any early retirement reductions by logging into your myRPS account and looking under 'My library'.

How do I claim my pension benefits?

If you’re ready to start claiming your RPS benefits there are four easy steps for you to follow.

 

1. Request an estimate:

You can do this by contacting your HR department for a benefits statement and details of your options, which are also included in your APE. Alternatively you can request an estimate from RPMI, based on the details RPMI holds for you by calling 0800 2 343434.

 

When contacting RPMI, please quote your pension reference number - you can find this on the 'Membership details' page, under the 'My Details' section of myRPS.

2. Apply for your pension benefits:

Fill in an ‘Application for Benefits’ form. You can download this from the  'Forms' section or request one from your HR department.

 

3. RPMI processes your application:

When RPMI receives your form, a letter of confirmation will be sent to you showing the benefits that you will receive, depending on the options you have chosen.

If you return your form more than a month before your retirement, RPMI will write to you, confirming that more details will be provided closer to the actual date.

 

4. Claim your pension:
When you reach your retirement date and are no longer actively contributing, you will start receiving your pension, every four weeks, for life.

How do I know what I will get in retirement?

Two handy places to start are both available in the myRPS section of this website. They are:
 

  1. Your latest Annual Pension Estimate; and,
  2. The Planner tool.

 

You can register or log on to myRPS.

How are my pension and lump sum calculated?

This is the important maths! You can see examples of this and the calculations used in your ‘Member guide' which you can access in 'My library' by registering or logging into the myRPS section.

Can I adjust the sizes of my lump sum and pension?

Yes! You could take a higher lump sum and therefore a lower pension or, a higher pension and therefore a lower lump sum.

 

A good rule of thumb is every £1 of you pension is worth £12 of you lump sum. So if you wanted to increase your lump sum by £12, you would decrease your pension by £1.

 

You can play around with scenarios using different amount of lump sum in our pension planner tool. Log on or register to use myRPS to use the planner.

What happens to my BRASS account?

When you take your benefits, the value of your BRASS account is used to buy you extra pension in your section of the scheme. However, your tax-free lump sum value must be at least equal to the value of your BRASS account, up to the maximum allowed by HMRC.

 

So the more BRASS savings you have, the lower the tax-free lump sum you can take from your RPS pension benefits, leaving you more benefits to use as pension.

Can I continue to work beyond my Normal Retirement Age (NRA) and still build benefits in the Scheme?

Yes, you can continue to work past your Normal Pension Age and accrue benefits up to age 75 or 40 years’ worth of contributions (depending on the section you work for, more information can be found in your Member Guide)..

What is lump sum ‘recycling’?

HM Revenue & Customs (HMRC) allows contributions paid into registered pension schemes, and the investment return on a pension scheme’s assets, to benefit from tax relief. The benefits paid out of such schemes can include a pension, which is taxable and a lump sum which is paid tax-free (up to a limit).
 
Recycling occurs where a pension scheme member intentionally uses some or all of the tax-free lump sum that they receive from a pension scheme to significantly increase their contributions to another (or the same) pension scheme, in order to gain further tax relief and entitlement to a tax-free lump sum.  It doesn’t matter if the tax-free lump sum is directly or indirectly reinvested into a pension scheme – this is still classed as recycling. An example of indirectly reinvesting the tax-free lump sum is to use your personal savings to significantly increase your contributions to a pension scheme, and replenish these savings with the tax-free lump sum.
 
Under HMRC rules, a tax-free lump sum must not be used in a way which exploits the generous tax relief available by ‘recycling’ the tax-free lump sum received.  These rules apply to UK and non-UK residents, and to individuals making contributions into overseas pension schemes.
 
If HMRC finds that recycling has occurred, it will impose tax charges on the member and possibly the scheme too.
 
Members of the Railways Pension Scheme are reminded of the rules prohibiting recycling when they apply for retirement and when they ask to make a one-off additional voluntary contribution to BRASS or AVC Extra.