Your benefits at retirement

Retirement guide
When a member requests to take their retirement benefits from the Scheme, they will be sent a retirement pack containing the necessary forms to complete in order to start receiving their benefits.

We know that the forms can seem complicated, so we are pleased to provide the below video to act as a guide for members who are in the process of completing their forms.

If you have any questions about the forms or your retirement options please contact us.

When is my pension payable?
Your pension is payable in full from the Scheme’s Normal Retirement Age (NRA) which is age 60.

Taking your benefits before age 60
You can take benefits at a reduced rate before you reach 60. The earliest age at which members can take their pensions varies, but you can find out the earliest age you can take your benefits by contacting the Scheme Administrator.

Reduced benefits at age 50
Most members can take reduced benefits from age 50. In 2010, the earliest retirement age for UK pension schemes increased from age 50 to age 55, although the majority of MPS members were not affected by this change.

If you are one of the small number of MPS members affected, you will have already been contacted by the Scheme Administrator to let you know that your earliest retirement age is 55 and not 50. If you are unsure, you can contact the Scheme Administrator whose details you can find in the contact us section.

Discretionary ill health benefits
The Trustees are currently able to provide immediate, unreduced benefits to deferred members who are unable to undertake any form of employment due to physical or mental deterioration in their health.

If you think that you may be eligible to receive your benefits early due to ill health, you can apply by writing to the Administration Office at the address below. You will need to provide:

  • Your Scheme number or National Insurance number; and
  • Professional medical evidence which confirms that you are unable to undertake any form of employment and are unlikely to be able to do so before you reach age 60.

The Scheme’s Medical Adviser will review all applications; this benefit can only be provided if they agree that you satisfy the criteria. If your application is unsuccessful, you would have the right to appeal the decision. You would also still be able to consider early retirement at the reduced level under the normal arrangements.
 Address for applications:
 Mineworkers’ Pension Scheme
 PO Box 555
 Stead House
 DL1 9YT

You can find more information on Discretionary Ill-Health benefits in the Summer 2018 edition of Pensions Newsline which is available here.

Notifying you of your benefits and options 
About three months before you reach NRA, the Scheme Administrator will send out a Retirement Benefit Options statement to your home address. Please help us keep in contact with you, and let us know if you change your home address.

Benefits and options

Your pension options, together with any options for payment of a lump sum, will be set out on the Retirement Benefit Options statement you receive from the Scheme Administrator at the time of your retirement.

If you left service before 6 April 1975
If you left service before 6 April 1975, you will be entitled to a pension, but no lump sum, although you might be entitled to take all your benefits as a single cash payment, providing you meet HMRC’s qualifying conditions for pension commutation. You can find out more from the section on cashing in small pensions.

If you left service between 7 April 1975 and 29 February 1992
You will be entitled to a fixed tax-free lump sum at retirement and, in some circumstances, you may also be able to take an optional higher cash lump sum.

If you left service after 1 March 1992
You have the option to take all your benefits in the form of a pension, or you can choose to take tax-free cash by exchanging some of your pension for a lump sum. You can exchange up to 25% of the total value of your MPS benefits. Under the Rules, the ‘exchange’ rate used for calculating the lump sum payable is 9:1, which means that for every £1 of annual pension given up, you will receive £9 of lump sum. You may wish to take financial advice if you are not sure which option is right for you.

In addition to your own entitlement, the Retirement Benefit Options statement will provide information on:

  • your pension payments – your pension will be paid every four weeks
  • taxation of your pension
  • pension increases after retirement and
  • death benefits after retirement
Industry Wide Mineworkers’ Pension Scheme (IWMPS)

Ill-health early retirement from IWMPS
Former MPS members who are contributing members of the IWMPS and who are awarded an ill-heath retirement pension from the IWMPS are automatically entitled to immediate payment of their unreduced MPS benefits. Payment is effective from the same date as IWMPS benefits.

Members who stop contributing to the IWMPS are not eligible to claim immediate ill-health retirement from MPS, although they are able to claim their MPS benefits on an early, reduced basis from age 50.

What tax code will be applied to my first pension payment? 
Your first pension payment is taxed using the current emergency tax code. Once your first pension payment has been made, details of your pension are sent to HM Revenue & Customs who then provide the Scheme Administrator with the correct tax code to use for future payments.

Overseas pensioners are treated in the same way for their first pension payment and will initially pay tax. If you live overseas and do not think you should pay UK tax please contact HM Revenue & Customs; if they agree they will provide the Scheme Administrator with a revised tax code.