What you must be told
As a member of a pension scheme, you have a right to be given certain information about what you have signed up to without having to ask for it.
Your scheme or provider must give you relevant information about your pension, automatically, when certain events happen (see below).
Also, if you're in a defined benefit scheme, the scheme must send you, every year, a summary funding statement. This gives you important details about the ability of the scheme to pay the benefits due under the scheme.
Information on joining
Your scheme or provider must give you basic information about the scheme when you join.
If you're automatically enrolled into your workplace pension scheme, you must be told:
- about automatic enrolment;
- that you have been automatically enrolled and what this means to you; and
- about your right to opt out.
If you do not qualify to be automatically enrolled, you must be told about the workplace pension scheme and your right to choose to join it.
The information must be given to you before the end of the month in which you are automatically enrolled or have a right to join.
Basic details on workplace pension schemes
If you're automatically enrolled, you should be given the basic details of the scheme within one month of being automatically enrolled.
If you're choosing to join a pension scheme, you should be given the basic details within two months of joining the scheme. The type of information you must be given is:
- what the scheme is called and who the trustees are
- how you build up benefits and how you can transfer other pensions in
- who can join and how you join
- the period of notice you must give to leave the scheme, and any conditions for re-joining at a later date
- the scheme's normal retirement date
- the rate of employer and employee contributions and how you can pay more
- whether the pension scheme is registered with HM Revenue & Customs and whether it is contracted out
- whether dependants' benefits are payable, and if so, the conditions for payment
- how to get a transfer quote, a refund of what you’ve paid in or details of the benefits you have built up
- how to complain about the scheme, including how to contact us, the Pensions Ombudsman or the Pensions Regulator about a complaint.
Also, if your workplace pension scheme is a defined contribution scheme, your scheme must tell you about your investment options, including investment charges. Your scheme or provider will probably give you a member booklet or member guide, containing this information.
Personal pensions, stakeholder pensions, self-invested personal pensions
If you set up a pension yourself, your provider must tell you the basic information about the scheme within thirteen weeks of joining. The type of information you must be given is:
- how to contact the scheme administrator if you have any queries
- the conditions of membership
- how to get scheme documents
- whether the scheme is registered and how you get tax relief on your contributions
- how your and your employer's contributions are paid
- your options on leaving the scheme (in summary)
- the investment policy (in summary)
- details of charges that will be applied
- the guarantee arrangements in the event of the scheme becoming insolvent
- how to complain, including how to contact us and the Financial Services Ombudsman about a complaint.
Your provider will usually give you a guide to the plan, a ‘key facts’ document and an investment guide. Between them, these documents should contain the relevant information.
Information while paying into the scheme
The statement must contain, as a minimum:
- the value of your pot on the day before the start of the statement year;
- the value of your pot on the last day of the statement year (or at the time when you left the scheme, if you left during the year);
- the amounts paid in by you;
- the amounts paid in by your employer;
- the amount of any tax relief paid into your pot;
- any amounts deducted for charges; and
- a statement giving a list of other information which you can request, such as the amount of investment gain or any amounts transferred in from another pot.
Other money purchase pension schemes
Your scheme or provider must give you, automatically, a statement each year.
The statement must contain the following information:
- the value of your pension pot at the start and end of the statement year;
- contributions paid to your pot, from you and your employer during the year;
- the amount of any investment loss or gain in the statement year;
- details of any tax relief paid by HMRC;
- the value of any benefits you have transferred from a previous scheme;
- details of any amounts deducted from contributions, for example, for fees; and
- an estimate of your income at your selected retirement date, in today's money; it must take into account how inflation between the date of the statement and your selected retirement date might reduce the amount of income your pot could buy (based on certain set assumptions).
If you have an employer’s pension, the statement must be given to you within twelve months of the end of the scheme year.
Information when you leave your scheme
If you stop paying to your scheme or pot before the scheme's normal retirement age or your selected retirement date, your scheme or provider should give you, automatically, details of your pension rights and options.
You should receive this information within two months of the scheme being told that you have stopped paying into the scheme or pot.
Click here for more information about your options when you stop paying to your scheme or pot.
Information on retirement options
If you're in a defined contribution scheme, your scheme or provider should automatically send you a statement of your options for accessing your pot. They should do this at least six months before your selected retirement date.
The information must include the option to take your pot from your current scheme or provider and use it to buy an income from another provider.
Click here to find out more about accessing your pot.
If you're in a defined benefit scheme, and take your benefits at your normal retirement date, you should receive a statement of your options automatically, within one month of the date your benefits are due to start. If you take your benefits before your normal retirement date, you should get this statement within two months of your chosen retirement date.
Most pension scheme members also have a right to transfer their pension arrangements. There are however a number of exceptions. If, for example, you are an active member of a scheme, a member of an unfunded public sector scheme, or a member of a defined benefit scheme (and within 12 months of your normal retirement date) you will not have a statutory right to transfer.
Defined benefit schemes are not required to notify you automatically of the option to transfer, so you may need to ask the administrator of your scheme if you are interested in this.
Information provided on your death
On your death, your scheme or provider must give information to your Executors or dependants about their benefits and options due as soon as possible, and not more than two months after it has been told of your death.
Click here to find out about the benefits that might be payable.
Information about changes to your pension
You must be told about changes to your pension, if they will affect you or the benefits for your dependants. You must be given time to think about the changes and give any comments you might have. You should be told about these changes even if you've decided not to be in the scheme.
If your scheme is a defined benefit scheme, the changes may include:
- changing the rate at which your benefits build up;
- stopping the build-up of your benefits temporarily;
- changing the salary used to work out your pension;
- changing the way pensionable service is worked out;
- closing the scheme to new members;
- closing the scheme so that you can no longer build up benefits; and
- winding up the scheme.
Click here to find out more information about winding up the scheme.
If you're in a defined contribution scheme, your employer must inform you and give you time to think about the changes and comment (or give your employee representatives this chance) if it's thinking about reducing its contributions to the scheme, or changing your provider. You must also be told of any changes to the investment options you have.
Click here to find out more information about scheme changes.
What information should I get when a join a scheme?
When you join an occupational pension scheme basic scheme information should be provided automatically within 2 months of joining the scheme.
Existing members, their spouses, beneficiaries and trade union representatives can request such information and this should be made available to them within 2 months of being requested.
There is specific information you should receive as well about automatic enrolment if you are automatically enrolled into a pension scheme.
I am leaving my employer's scheme in the near future. When will I receive details of my benefits?
Details of your benefits must be supplied within two months of leaving. If on receipt of these details you then ask for a transfer value, this should be supplied within a reasonable time of your request (interpret this as 3 months).
I am a member of a company pension scheme and have not received any details of my benefits for several years. When should details be sent out?
If you are a member of a final salary scheme, the administrators are not obliged to issue benefit statements automatically. If you request a statement, then this must be issued within two months of your request. If you are a member of a money purchase scheme, a benefit statement must be issued automatically at the end of each scheme year.
What happens if my employer doesn’t pay contributions to my pot?
If your scheme trustees or pension provider believes there is a serious problem with the payment of contributions, they first need to tell the Pensions Regulator. They must then tell you about it within 30 days of telling the Regulator.
I have heard my pension scheme is to be wound up. What information will I receive?
When a scheme is being wound-up, the trustees must issue a notice to inform all members and beneficiaries (except deferred pensioners who cannot be traced) in writing within one month of the winding-up having commenced.
In addition, this notice must:-
- give the reasons that the scheme is being wound up;
- give a statement to active members as to whether death benefits will continue to be provided;
- inform members, where relevant, that an Independent Trustee has been appointed; and
- supply a name and address for further enquires.
The trustees also need to issue a progress report to members at least every 12 months thereafter.
These subsequent reports must give details of:-
- Action being taken to establish the scheme's assets and liabilities;
- Action being taken to recover any assets not immediately available;
- The estimated date when final details of members' benefits are likely to be known; and
- The extent (if any) to which the value of the member's benefits is likely to be reduced (where relevant and the trustees have sufficient information to state this).
I am a member of a personal pension arrangement, will the company contact me when I am due to retire?
Your pension provider must send you a statement of your options for opening your pot at least four months before your expected date of retirement. Most personal pension schemes will require you to select a retirement date at the time you join.
Where can I find out more?
If you need more information, please contact us. A pension specialist from our team will be happy to help with whatever pensions-related question you have. Our help is always free.