UK Annuity UK Annuities                                                                               Add to Favourites

CLICK HERE FOR ADVICE ON WHETHER YOU CAN ENCASH YOUR PENSION

CLICK HERE TO FIND THE BEST AVAILABLE ANNUITY RATES FOR YOUR CIRCUMSTANCES

IF YOU WOULD LIKE THE ADVICE OF AN ACCOUNTANT YOU CAN VISIT THIS [ ACCOUNTANTS DIRECTORY ] AND FIND AN ACCOUNTANT NEAR YOU.

The Second State Pension Scheme

Most people can expect to get the Basic Old Age Pension when they reach State Pension age. In addition to the Basic Old Age Pension, many people also qualify for the additional State Pension.

Until April 2002 this was called the State Earnings-Related Pension Scheme or SERPS for short. In April 2002, SERPS was reformed and is now called the Second State Pension.

Like SERPS, the State Second Pension is based on your earnings above a certain level and on which you have paid Class 1 National Insurance contributions (NICs). Employees earning at least the lower earnings limit (£4,108 in 2004-5) are entitled to the State Second Pension unless:-

  1. They are married women who have opted to pay reduced National Insurance.
  2. They have contracted out of the scheme.

The State Second Pension entitlement is based on:-

  • A proportion of your earnings each year between two figures - the 'lower earnings limit' (£4,108 in 2004-05) and the 'upper earnings limit' (£31,720 in 2004-05); and the number of years between age 16 (or 1978 if later) and reaching State Pension age.
  • Employees earning between £4,108 and £11,600 (in 2004-05) will have their Second State Pension calculated as though they are earning £11,600.

What happens to my SERPS pension entitlement?

You keep any SERPS entitlement you have already built up, but from April 2002 onwards you no longer build up any new SERPS pension. Instead you build up State Second Pension.


To find out more about The Second State Pension, without obligation, please complete the short form here.

NB

The Government has stated that it may change the State Second Pension to a flat rate scheme for everybody who is contracted-in to the State Second Pension. If this proposal goes ahead, everybody who contributes to the State Second Pension from that date will build up their State Second Pension at the same rate, irrespective of his or her earnings.

The Department of Work and Pensions has information about State pensions and benefits on it's website at: Department of Work and Pensions.

 

Please note that articles on My-Annuity do not constitute regulated financial advice. These articles are intended to provide general personal financial information. You should always consult an Independent Financial Adviser (IFA) before making ANY financial decision. You can request a call from an IFA here or alternatively you can find an IFA in your local area here.

 

Visitors are strongly urged to consult with a qualified financial advisor before making any investment decision. Neither my-annuity.co.uk nor any person involved with the running of this website can be held responsible for any investment decisions made by our visitors. This website is an independent UK marketing website and not a provider of financial services or advice in any form. We pass on your pension annuity enquiries to Independent Financial Advisers and cannot offer financial advice. We are not responsible or liable for any financial service, or annuity product obtained through a third party. An annuity enquiry from this website does not constitute an offer to provide an annuity policy.


   Terms and Conditions
  © 2000-2006