UK Pension Scheme or Plan but You Live in Spain?
At Money Saver Spain we like to empower our visitors with information to make their own decisions. However, we sometimes come up against areas that are just too complicated or that each individual is affected in a different way. This is the case with UK Pension Schemes (or Plans), as it seems that every year, in the UK, there are new laws, new regulations, new ideas or changes to pension plans or schemes.
To complicate matters even more there are still many arrangements that have different names. Keeping up to date isn’t easy, so we got in touch with David Goodall who runs Financial Pages In Spain, to give us a few tips on terminology and the most usual questions that can arise.
It helps to cut through the jargon, especially regarding acronyms. Here’s a list (and it probably isn’t exhaustive) of the titles sometimes used for pension plans:
- PPP – Personal Pension Plan
- SIPP – Self Invested Personal Pension
- GPP – Group Personal Pension Plan
- S32 – Section 32 Pension Transfer Plan
- ShP – Stakeholder Pensions
- PPTP – Personal Pension Transfer Plan
- UP – Unsecured Pension
- ID – Income Drawdown
- ASP – Alternatively secured pension
- AVC – Additional Voluntary Contributions
- FSAVC – Free Standing Additional Voluntary Contributions
- COMPS – Contracted Out Money Purchase Scheme
- CIMPS – Contracted In Money Purchase Scheme
- EPP – Executive Pension Plan
- RAC – Retirement Annuity Contract
- Section 226 Annuities
- Superannuation Schemes
- SSAS – Small Self Administered Scheme
- OPS – Occupational Pension Scheme
- DBS – Defined Benefits Scheme
- FSP – Final Salary Scheme (DBS & FSP are the same – different names)
- S2P – State Second Pension
- GPS – Graduated Pension Scheme
- SERPS – State Earnings Related Pension Scheme
- BSP – Basic State Pension
- SRP – State Retirement Pension (BSP & SRP are the same)
Most people when taking out a pension plan only have the basic conditions explained, which means that after moving abroad and considering whether and when you can start to receive your pension there could be a whole variety of rules and regulations that you didn’t know existed. David has produced a list of common questions and his advice in each case:
[accordion title=”Q1: Taking a Company Pension Early“] My company scheme won’t let me take my pension until I’m 65 and I’m only 57 now.
If the scheme rules say 65 then that cannot be changed, although most schemes allow for early retirement due to ill-health. You could talk to a suitably qualified adviser about a pension transfer, which, if the circumstances are suitable, might be arranged. [/accordion]
[accordion title=”Q2: What if I’ve lost the paperwork?“] I’ve got two pension plans but I seem to have lost the paperwork in my move to Spain.
You need to provide as much information as possible, but they can be traced by a tracing service for a small fee. [/accordion]
[accordion title=”Q3: Widow/widower’s Pension “] I am a 59 year old widow but I don’t draw my company pension until I’m 62 and half. I won’t need a widower’s pension.
The provision of a widow’s pension within a scheme can reduce the amount of initial pension you receive. The answer to this query is complex and you need to get advice from one of a limited number of specialists who deal with these issues. [/accordion]
[accordion title=”Q4: What can I do about a Frozen Pension in the UK?“] I have a frozen pension in the UK with a former employer. I’d rather have control myself so can I have a SIPP? Or do you have another suggestion?
A SIPP is a possibility but not the only one. You need to have the full range of options available. The Financial Services Authority in the UK (FSA) requires pension transfers to be handled by a transfer specialist specifically authorised through their qualifications. [/accordion]
[accordion title=” Q5: How much UK State Pension will I receive?“] I’m 63 years old and live in Spain just drawing my private pension. How can I find out what State Pension I will receive?
You can get a forecast of your State Pension using a Form BR19. You can do this online at the Deptartment of Work and Pensions (DWP) website. [/accordion]
As you can see, it’s all rather complex and in cases with pensions from multiple sources or requests to draw a pension before the due date it’s usually a case of getting professional advice (as with drafting a will in Spain) in order to make sure you don’t actually lose money or entitlement.