Your NHS pension 'health-check'

Members who have not previously had issues with their levels of pension input may find themselves exceeding their annual pension contribution limits (their ‘Annual Allowance’) through a combination of various factors; 

• Increased income levels for GPs that have undertaken Covid vaccination work

• The recent increases in inflation

• An increase in the rate at which pension benefits build up following the movement of all members of the NHS Pension Scheme to the 2015 section from 1 April 2022. 

Where members exceed their Annual Allowance, an additional tax charge could be levied which will need to be paid to HMRC. 

There are potential options available to help mitigate this, such as carrying forward unused annual allowances from previous tax years (if available), or the option of using the NHS ‘Scheme Pays’ facility – though care must be taken with this latter option to ensure members fully understand the longer-term impact this can have on their pension benefits. 

To help understand your level of pension input, and what allowances may be available from previous years, you can request an ‘Annual Allowance Pension Savings Statement’ from the NHS Pension Scheme.  In addition to this, you should also download your most recent Total Reward Statement to help review your benefits and ensure your membership is being recorded correctly. 

When it comes to planning around the Annual Allowance there are various options available, and the right course of action will vary from one member to another. Our expert financial planning and healthcare accountancy team are on hand to guide you through the available options and understand the right approach for you.