You will receive an annual pension and a one-off lump sum. Your lump sum will be paid direct to your bank or building society account, whichever you indicate on your Personal Details Form.

Your pension will be paid every month, in arrears, directly into your bank or building society account. Your pension will be treated as earned income for tax purposes; any tax that is due is taken off before the pension is paid.

The amount of your pension will depend on your pensionable earnings and length of reckonable service.

You should be aware that there is a maximum number of reckonable service years we can use, and that is 45.

Before 1 March 2008, the number of years was restricted to 40. However, from 1 March 2008, anyone who had already reached their 40 years’ service could start to build up further service to the maximum of 45.

Refund of widow(er)s’ pension (WPS) contributions (The contributions you paid up to and including 30 September 2002)

If you are unmarried throughout your service you are entitled to a refund of WPS contributions when your pension comes into payment. If you partially retire and claim your pension then the refund of WPS contributions will not be paid until you take full retirement.

If you have been married or in a civil partnership for only part of your service on or prior to 30 September 2002, you are entitled to a refund of the contributions you have paid since your marriage or civil partnership ended. These contributions will be refunded with interest. A deduction of a single, non-returnable payment will be made to cover the cost to the scheme of providing a pension to a widow, widower or surviving civil partner if you marry or enter a civil partnership after claiming your pension and die before your wife, husband or civil partner.

We work out your pension in two parts. You earn 1/80 of your final pensionable earnings for each year of reckonable service in the scheme before 1 October 2002 and 1/60 of your final pensionable earnings for every year of reckonable service in the scheme from 1 October 2002.

Pension at scheme pension age (60)


Lloyd retires after 30 years’ service of which 20 years were before 1 October 2002 and 10 years were from 1 October 2002. Lloyd’s final pensionable earnings are £20,000 a year.


Lloyd’s pension is made up of two elements, worked out as follows:

For service before 1 October 2002 (1/80 x 20) x £20,000 = £5,000

For service from 1 October 2002 (1/60 x 10) x £20,000 = £3,333.32

Total = £8,333.32

Automatic lump sum

Lloyd will get an automatic lump sum relating to his service before 1 October 2002 of 3/80 x 20 x £20,000 = £15,000. (This will be tax free, subject to the Lifetime Allowance.)

15 December 2021
Last updated:
29 June 2022