UTC (UK) Pension Scheme - Member Newsletter 2023

Your retirement choices If you have not started taking your pension from the Scheme yet, are you aware of your options? When can I start taking my pension benefits?

If you choose to transfer out You can typically choose from the following options if you have reached NMPA: • Take your retirement savings as a cash lump sum, or a number of cash lump sums; • Invest in a defined contribution (DC) income drawdown arrangement – leave your money invested and draw as much as you want when you need it until it has gone; • Purchase an annuity (pension for life) with an insurance company, to suit your circumstances (such as providing benefits to your dependents, or having annual increases). You can usually choose one of the above options, or a combination. Typically 25% can be taken tax free, with the remainder taxed as income. If you’re under NMPA, or over and don’t want to start accessing your retirement savings straight away, you can transfer your benefits into a DC arrangement of your choice and then choose from the options above once you’re at or over NMPA.

The Scheme, which is a defined benefit (DB) arrangement, has a Normal Retirement Age (NRA) of 65 for most members – the age you are expected to start taking your pension benefits. However, you may be able to start taking your pension benefits earlier, from the Normal Minimum Pension Age (NMPA), currently age 55, subject to Trustee approval. What are my options for taking my benefits? Take your pension benefits from the Scheme once you reach your NRA which may include: • A monthly pension which increases annually in line with the Scheme Rules (broadly in line with inflation)* • The option to take up to 25% of the value as tax-free cash* • Benefits for your dependents upon your death. OR If your pension benefits are classed as ‘small’ (£10,000 or less, or £30,000 or less if all pension savings that you have don’t exceed this amount) you can request to take these as a cash lump sum (25% would be tax free with the remainder taxed as income). OR Transfer your pension benefits out of the Scheme into a pension arrangement of your choice, any time up to one year prior to your NRA, and take them in a way that suits you. *Your pension is likely to be reduced if 1) you take it before your NRA, to allow for the fact that it would likely be paid for longer, and/or 2) if you choose to take tax-free cash.


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