Life events

When life changes, it’s important to consider how your pension may be affected.

Death Benefits

If you die as a member

If you die while an active member of the Scheme, which is where you're still working at the company and building up a pension, BOC Pension Services provides the following to your dependant(s) (someone you nominate to receive your death benefits):

1. A cash lump sum

This includes:

• A lump sum of four times your final earnings; and
• A refund of your contributions (including those made through Salary Exchange, which is where your contributions are taken from your salary before tax and National Insurance), plus interest.

2. A pension

Your Recognised Dependant will get a pension for life, equal to half the pension you would have received if you remained an active member until Normal Retirement Age (NRA) based on your final earnings. Your NRA is 65 unless you take early retirement. This may be reduced if your Recognised Dependant is more than ten years younger than you.

3. A Child’s Allowance

Each qualifying child would get a Child's Allowance of one quarter of the Recognised Dependant's pension, up to a maximum of four children.

If you are not survived by a Recognised Dependant but are by at least one qualifying child who the Trustee considers has been left without the necessary support of another adult, the first Child's Allowance will be increased to the full amount of the Recognised Dependant's pension.

The total amount of the Child's Allowance is then allocated between your qualifying children by the Trustee.

4. A pension guarantee

If you and your dependants die before a total of five times your pension has been paid (in relation to your Pre-1 April 2011 Pensionable Service at the date of your death), your beneficiaries will receive a lump sum equal to this amount (minus any payments already made to you and your dependants but excluding any Child's Allowance).

Protecting your loved ones

If the worst were to happen, it’s comforting to know that your loved ones would be supported financially.

The Trustee, which is the organisation responsible for running the Scheme, makes the final decision about who receives any lump sum death benefits. However, it will take your wishes into account when making its decision. Under current legislation this allows the benefit to be paid free of Inheritance Tax.

You can make your wishes known to the Trustee by doing the following:

1. Download and fill out an Expression of Wish form.
2. Return it to BOC Pension Services.
3. Keep it up to date as and when your preferences or circumstances change.

If you die in retirement

If you die as a Pensioner, the following benefits are payable:

1. A pension

Your Recognised Dependant will receive:

• A pension for life. This is equal to half of your pension but based on your Final Earnings rather than your Final Pensionable Earnings (before any reduction for early retirement or taking a tax-free cash lump sum); plus
• Any extra pension that you chose to provide for your dependant (in exchange for part of your pension at retirement) when you retired; plus
• Any extra pension from your Additional Voluntary Contribution (AVC) fund that you chose to provide for your dependant when you retired. AVCs are extra payments you can make towards retirement. If you pay AVCs, these will be kept in a separate Account to your BOCPS pension.

If your Recognised Dependant is more than ten years younger than you, the Trustee may reduce the amount of pension payable.

See example case study

2. A Child's Allowance

A Child's Allowance is payable, calculated in the same way as if you die as an Active Member, but by reference to the Recognised Dependant's pension payable on death in retirement. The Trustee will allocate the Child's Allowance between your Qualifying Children.

See example case study

3. A pension guarantee

If you and your dependants (if any) die before a total of five times your initial pension has been paid, your beneficiaries will receive a lump sum equal to this amount (minus any payments already made to you and your dependants but excluding any Child's Allowance).

Case study: dependants’ benefits

William is retired and dies at age 70. He is not married but lived with Hazel (aged 61), and they have one child, Kathy (aged 21), who is still at university.

As Hazel and William have lived together for many years, and Hazel relied on William’s income to pay their joint bills, she is a ‘Recognised Dependant.

Hazel will receive:

£23,500 Final earnings

x

25 years Pensionable service

x

1/60

=

£9,791

(William's pension based on his Final Earnings, ignoring his tax-free lump sum)

1/2 of £9,792 = £4,896 a year

Kathy will receive:

As Kathy is in full-time education and under age 23, she will receive a Qualifying Child's pension of:

1/4 of £4,896 = £1,224 a year

until age 23

Please note: This example is intended to illustrate broadly how the calculations operate - it does not account for any pre-1 April 2011 and post-1 April 2011 split that would be applied in practice.

Children

I'm having a child

When you take time off to raise a child, the last thing on your mind is probably your pension. However, it’s good to know that you can remain a member of the Scheme.

If you take maternity/paternity, parental or adoption leave, this is what will happen to your pension.

Contributions

• Your contributions will continue to the Scheme based on your Pensionable Earnings and on your normal hours. Pensionable Earnings are the earnings on which your pension contributions are based. Pensionable Earnings include all contractual elements of your pay (including overtime and sick pay), before tax and deductions for contributions to the Scheme; Additional Voluntary Contributions; and deductions in relation to State sickness, Incapacity or invalidity benefits

Other benefits

• Provided you don’t leave the Company or opt out of the Scheme, you are entitled to the same range of benefits as if you were working normally e.g. death-in-service and ill-health benefits.

If you decide not to return to work after your period of approved leave, the date your maternity/paternity, parental or adoption pay stopped will be used as your leaving date.

Update your details

Once you've got a child to look after, you may want to consider adding them to your list of 'beneficiaries'. This is your list of people you want to support financially with your lump sum or death-in-service benefits. Read What happens to my pension when I die? for more information about what your beneficiaries will be entitled to.

To update your beneficiaries:

1. Download and fill out an Expression of Wish form.
2. Return it to BOC Pension Services.
3. Keep it up to date as and when your preferences or circumstances change.

Marital status

Changing your name

Keep BOC Pension Services updated

To access your pension benefits, your details must be correct on BOC Pension Services’ records. If details such as your name, address or bank details are out of date, there is a chance that payment(s) will be delayed or even prevented.

Getting married

How it affects your pension

If you get married, you may want to change who would receive any benefits in the event of your death. Whoever you choose would then become your ‘beneficiary’ (or ‘beneficiaries’).

The Trustee makes the final decision about who receives any lump sum or death in service benefits. However, it will take your wishes into account when making its decision. Under current legislation this allows the benefit to be paid free of Inheritance Tax.

Updating your details

You can make your wishes known to the Trustee by doing the following:

1. Download and fill out an Expression of Wish form.
2. Return it to BOC Pension Services.
3. Keep it up to date as and when your preferences or circumstances change.

If you get divorced

If you get divorced, both you and your spouse or registered civil partner's pension benefits must be taken into account when your joint assets are being calculated.

• If the Trustee receives a pension sharing order from the Court, your former spouse or registered civil partner will become entitled to a share of your pension - called a pension credit.
• The Trustee will require your former spouse or registered civil partner to transfer this pension credit out of the Scheme to a suitable separate pension arrangement.
• A separate process applies if the Trustee receives a Court order requiring pension ‘earmarking’. This is where money is set aside for a specific purpose.

Changing address

If you move house

It is in your best interests to keep BOC Pension Services informed of any address changes, even after you have left the Scheme. This is because your details are needed in order to make any payments when you choose to access your savings.

Workplace changes

If you fall ill

If you have to leave your job due to ill health or as a result of an accident before you reach Normal Retirement Age (NRA), you may be able to take your pension immediately if the Company consents. Your NRA is 65 unless you take early retirement.

The Trustee will determine your eligibility for ill health or incapacity. The Trustee's decision will be based on medical advice and evidence. If you are eligible you can then choose to take a cash lump sum (if you wish) and an immediate pension.

1. Tax-free cash

If you retire due to Ill health or Incapacity, you still have the option to take a tax-free cash sum. This is calculated in the same way as for normal retirement but based on your pension when you actually retire.

2. Ill-health medical pension

If you are eligible for an ill-health medical pension, your pension will be calculated as if you retired at NRA, but based on your Final Pensionable Earnings and Post-1 April 2011 Pensionable Service at the date you leave the Company. Your pension would not be subject to a reduction for early payment. You will also receive an unreduced pension in respect of your Pre-1 April 2011 Pensionable Service.

3. Incapacity medical pension

If you are eligible for an incapacity medial pension:

• For your Pensionable Service before 1 April 2011, you will get the full pension you built up.
• For your Pensionable Service after 1 April 2011, your pension will be increased by half the remaining Pensionable Service you would have completed if you reached NRA or the end of your employment contract (if earlier). However, the Trustee can decide otherwise based on your circumstances if necessary.
• Your pension is then calculated in the same way as if you had retired at NRA, but based on your Final Pensionable Earnings at the date you leave the Company. Your pension would not be subject to a reduction for early payment.

Capped increases to Pensionable Earnings

For the purpose of calculating ill-health retirement and incapacity pensions earned from 1 April 2011, your Pensionable Earnings (and therefore Final Pensionable Earnings) are subject to an annual 2.5% cap on increases, averaged over rolling five-year periods.

If you aren’t sure whether you are eligible, please Contact BOC Pension Services for more information.

Working part time

There are many reasons why you might consider working part time. You may want to reduce your hours to take care of your children or step down a gear close to retirement.

If you work for the Company on a part-time basis at any time while a member of the Scheme, your Pensionable Service is adjusted proportionally when calculating your pension benefits.

If you leave the Company

If you leave the Company or opt out of the Scheme, you have two options:

Option one – leave your benefits in the Scheme

Option two – transfer out

You can leave your benefits in the Scheme as a “deferred” pension until you want to access them. To offset the effects of inflation, your deferred pension is increased each complete year between the date you leave and the date you retire.

You can usually transfer the value of your benefits to another registered pension arrangement (e.g. your new employer's pension scheme or a personal pension arrangement). You can request a transfer value from BOC Pension Services by completing and returning a Deferred Benefit Claim form. You should think about getting financial advice if you’re thinking about transferring your pension benefits elsewhere. You can find a local Financial Adviser at www.unbiased.co.uk

If you leave the Company you would no longer be entitled to the lump sum death-in-service benefit.

Opting out

What options you have

If you decide to opt out of the Scheme, the same options for your pension apply as for leaving the Company.

From the date of opting out you would build up no further pension benefits in the Scheme and would be unable to re-join after opting out. This could seriously affect the potential future income you would have in retirement and the benefits available to your family on your death.

You will be eligible for the lump sum death cover of four times your Pensionable Salary while you remain an eligible employee of the Company.

The process

1. Download and fill in an Opt-out form
2. Return the completed form to BOC Pension Services

If you’re made redundant

No one likes to think about this possibility, but it’s good to know your options if you are ever made redundant whilst an active member of the Scheme. An active member is someone who is currently contributing and working for the Company. Here’s an overview of what might happen with your pension:

• Any redundancy pension you receive would be based on your Final Pensionable Earnings, which are in turn based on your Pensionable Earnings. Increases to your Pensionable Earnings from 1 April 2011 are subject to an annual 2.5% cap, averaged over rolling five-year periods.
• You may be able to receive an unreduced redundancy pension from age 55 provided you have at least ten years’ Qualifying Service.
• If you are made redundant then fall ill you may be able to take your redundancy pension before age 55 with Trustee consent.
• You might be able to delay taking your redundancy pension until age 70, in which your benefits would be increased to reflect this delay.