Life events
When life changes, it’s important to consider how your pension may be affected.
Death Benefits
If you die as a deferred member
If you die while a deferred member of the Scheme, which is where you have either left the Company or opted out of the Scheme, BOC Pension Services provides the following to your dependant(s) (someone you nominate to receive your death benefits):
1. A pension
Your Recognised Dependant will receive a pension for life, equal to half of your deferred pension (which is based on your Final Earnings rather than your Final Pensionable Earnings). This is increased between the date you left the Scheme and your date of death, to help it keep pace with inflation. This may be reduced if your Recognised Dependant is more than ten years younger than you.
Final Earnings are broadly your Pensionable Earnings (your earnings before tax, contributions and State benefits are deducted) for the 12 months before leaving the Scheme, retirement or death. They are based on your Pensionable Earnings, which are increased up to an annual 2.5% cap from 1 April 2011, which is averaged over rolling five-year periods. However, if a lump sum is calculated if you die while still working for the Company, this 2.5% increase cap is ignored.
2. 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.
3. Pensions guarantee
If you and your dependants die before a total of five times your deferred pension at date of death 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).
If you need to let the Trustee know about the death of a member, please download and fill out a Death of an Active Member, Deferred Member or Pensioner form, and return it to BOC Pension Services.
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.
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.
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
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:
(William's pension based on his Final Earnings, ignoring his tax-free lump sum)
Kathy will receive:
As Kathy is in full-time education and under age 23, she will receive a Qualifying Child's pension of:
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
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:
- Download and fill out an Expression of Wish form.
- Return it to BOC Pension Services.
- Keep it up to date as and when your preferences or circumstances change.
It is important to complete a new form each time your personal circumstances change, even if your nominated beneficiaries do not 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.
To tell BOC Pension Services about a name change, please download and fill in a Notification of Change in Circumstances form and return it to BOC Pension Services.
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:
- Download and fill out an Expression of Wish form.
- Return it to BOC Pension Services.
- Keep it up to date as and when your preferences or circumstances change.
It is important to complete a new form each time your personal circumstances change, even if your nominated beneficiaries do not 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.
If you are recently divorced, you may want to complete a new Expression of wish form so that the Trustee knows who you would like to receive any lump sum death benefit payable in the event of your death.
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.
If you change address, please download and fill in a Notification of change in circumstance form and return it to BOC Pension Services.
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 are eligible for an ill-health or incapacity medical pension, please Contact BOC Pension Services to choose how to take your benefits.
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.