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Myth busting! – some clarification for Veterans

It’s the final day of our Pension Awareness Week campaign, and as promised we have a little something for Veterans.

When I left the Armed Forces in 2012, I received an immediate pension from the ’75 scheme.  It will be my 55th birthday next year and I have been told that my pension will double – is that correct?

No, that’s incorrect.  If you took resettlement commutation under AFPS 75 to increase your tax-free lump sum when you left the Armed Forces, your pension will return to its original (pre-commutation) amount, and the pension will be subject to a consolidated uplift of the inflationary increases (based on the Consumer Price Index) backdated to your date of discharge.

I have heard that my Armed Forces pension will be reduced when I start to receive my state pension.

Your Armed Forces pension will not be reduced when you start to receive your state pension if all of your reckonable service was after 1st April 1980.  Those who do have reckonable service before1st April 1980 will have a small reduction to their armed forces pension of approximately 87 pence per year for each year of service before that date.

I’m told I can ‘top up’ my Armed Forces pension after leaving the service.

Unfortunately, not. You need to be serving to make additional voluntary pension contributions (AVCs) to AFPS15

Rumours floating about suggest that veterans retiring abroad will have their pensions “frozen” until they return back to UK.  As my family and I are planning to emigrate to Australia, New Zealand or Fiji in the near future, I would like to know if such move will freeze my pension or not.

Armed Forces pensions are claimed and paid in the same way no matter where you live.  If you live overseas, you will receive a Life Certificate every three years once your pension is in payment. It is important that you deal with it straight away because, if the form is not returned in accordance with the instructions your pension will stop.  Under current rules, moving overseas would also not impact on the annual inflation-linked increases to your Armed Forces pension/EDP income. You would still benefit from the increases but, as would be the case if you remained in the UK, you do not receive the uplift until you reach age 55.

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