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This blog is a reference point for English-speaking residents and visitors to Spain. It is written by David Goodall, an experienced Financial Adviser in both UK and Spain. More Info

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Financial Life in Spain

UK Pension scheme or plan but you live in Spain?

August 17, 2011

It seems that every year, in the UK, there are new laws, new regulations, new ideas or changes to pension plans or schemes. Just to complicate matters there are still many arrangements which have different names!

 

If you have a plan that you don’t understand, let me know, what it is, what it’s called and I’ll do my best to explain it.

 

Here are a list (and it probably isn’t exhaustive) of the titles sometimes used for pension plans. If you have one but don’t understand what it is, please send me a message me.

 

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)

 

The whole pension plan or scheme scenario is so complex it certainly causes people to ‘turn off’. It might also explain why only 42% of working men and 46% of working women, in the UK, have entitlements above the Basic State Pension. Please contact me if you want anything explained!

 

Even when you have understood the plan or scheme you have, there could be a whole variety of rules and regulations that you don’t understand. Especially Company or Occupational schemes have very individual scheme rules. I have, therefore produced a table of comments and questions, with my responses.

 

 

Comment / Question

Response

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.

 

I’ve got two pension plans but I seem to have lost the paperwork in my move to Spain.

I can put you in touch with a tracing service which will hunt for your plans. You need to give as much information as possible but they can be traced.

 

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 widow’s pension.

The provision of a widow’s pension within a scheme can reduce the amount of initial pension you receive. The answer to your query is complex and you need to get advice from one of a limited number of specialists who deal with these issues.

 

I’m only 45 years old and have a pension fund worth £33,500. I’ve been told that I can’t cash it in even though it’s in the UK and I’ve lived in Spain for 7 years.

If you have no intention of moving back to the UK, it is worth considering transferring your existing fund to a recognised alternative, approved by the UK tax authorities (HMRC). There will be a number of alternatives so your current and future circumstances need to be considered.

 

I have a frozen pension in the UK with a former employer. I’d rather have control myself so can I have a SIPP?

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.

 

I’m 63 years old and live in Spain just drawing my private pension which is paid into my UK bank account, changed to euros and sent to me in Spain.

 

How can I find out what State Pension I will receive?

This is often the arrangement people make. You might benefit from comparing the rate the bank gives you with an alternative.

 

 

You can get a forecast of your State Pension using a Form BR19. Either seek one on the Dept. of Work and Pensions (DWP) website or I will email you a blank form for you to complete.

 

It’s complex isn’t it? I will help if I can.

 

 

David Goodall

 

[email protected]

 

 

 

 

 

by davidgoodall. Find out more about davidgoodall here.




One Response to “UK Pension scheme or plan but you live in Spain?”

  1. Good info. Thank you for the time you took to write this post. To everyone else, also check out thepension.org – it’s a new resource for pension and retirement info.