Forces Pension Society

Fighting for the forces and their families

The Armed Forces Pensions Rumour Mill strikes again!

November 10, 2017

We heard another ‘pension rumour’ earlier today when a member got in touch with us because he was thinking of leaving the Services early.

His reason for this early termination – he had been told that the Government was about to start taxing the tax-free lump sum payable on discharge or retirement!  Again, we have no idea where and how this rumour started, but we can tell you that it is untrue – the tax free lump sum entitlement (either Early Departure Payment (EDP) Lump Sum (’05 and ’15 schemes) or the Terminal Grant (’75 scheme)) is paid tax free and there are no plans to change that.

Leave if you have decided that the time is right to do that, but please don’t leave to avoid paying tax on your lump sum – there is no need, it is tax free anyway.

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