The NHS Pension Scheme continues to be one of the most comprehensive and generous schemes in the UK and offers excellent benefits for members for when they retire.
- What is the NHS pension scheme?
- How do I join the scheme?
- How does it work?
- What are the costs of being in the NHS pension scheme?
- Benefits of the NHS pension scheme
- Leaving the NHS pension scheme
- Questions about the NHS pension scheme
What is the NHS pension scheme?
The NHS pension scheme is a large pension scheme specifically set up for employees of the National Health Service. When you join the scheme, you begin saving up for your future retirement.
How do I join the scheme?
When you start your career with the NHS, you’ll automatically be enrolled into the scheme however, as it’s voluntary, you can choose to opt-out should you wish.
How does it work?
Both you and your employer will pay monthly contributions into the scheme, meaning that the cost of your future retirement benefits are shared between you and your employer.
When you get to retirement, the NHS will begin to pay you a pension. The pension payments are payable to you from your retirement date for the rest of your life*.
*Note that you do not need to take all of your retirement savings as a pension. Instead, you can choose to exchange some of your pension for a one-off tax free cash lump sum. Obviously, this would mean that your pension payments would be reduced, but you’d have an immediate lump sum to spend.
What are the costs of being in the scheme?
How much you pay into the scheme is based on your pensionable earnings or whole time equivalent if you work part time. The table below shows the contribution rates:
|Pensionable Pay (whole time
equivalent) / Earnings used to
asses contributions rate
|Contribution rate from 1 April 2015
|Up to £15,431.99
|£15,432.00 to £21,477.99
|£21,478.00 to £26,823.99
|£26,824.00 to £47,845.99
|£47,846.00 to £70,630.99
|£70,631.00 to £111,376.99
|£111,377.00 and over
The government has announced the outcome of its consultation on proposed changes to member contribution tiers and contribution rates to be implemented from 1 October 2022 onwards. This page will be updated with this information soon.
Benefits of the NHS pension scheme
It’s tax efficient – Contributions to the scheme are tax free, bringing down the cost of membership.
Financial security – Your pension depends on your earnings and how long you have been a member of the scheme. Benefits are secure and guaranteed by the government.
Employers make a significant financial contribution to the scheme, meaning that the cost of your future retirement benefits are shared between you and your employer.
Flexibility – Options are available for members to increase their benefits and retire flexibly, to suit their own needs.
The scheme provides valuable life cover for you whilst in service, protection for your family and benefits on ill health.
Leaving the NHS pension scheme
If you’re looking to leave scheme, you’ll need to complete part of the application to leave (an SD502 form).
Once you’ve filled in your part and given this to your Payroll Department, your employer will complete their section and forward the completed application to NHS Pensions.
You can download the SD502 form by clicking here.
If you’ve made previous contributions, you may be entitled for a refund. You may also be able to transfer your pension benefits to another provider in the UK.
You can use the opt out calculator to understand the impact on your take home pay, should you leave the scheme. To find the opt out calculator, click here. To view the leaving early and transferring out guide, click here.
Questions about the NHS pension scheme
Our blog is a guide to provide readers with more information on the NHS pension scheme. We do not offer any financial advice. If you have any specific questions, and you are unable to find the information on the below websites, then please contact your employer or email@example.com
- NHS Employers – Pensions
- NHS Employers – Pension Resources
- NHS Pensions – Business Services Authority
If you’re interested in working in the UK and would like to discuss the positions available in your specialty, and how we can assist you, please contact our team.