Your Lafarge Pension - Lafarge UK PensionsSeminar... · Lafarge UK Pension Plan 20 February 2012 2 Your Lafarge Pension Depends on length of pensionable service ... Your Lafarge Pension

Your Lafarge Pension

Lafarge UK Pension Plan

20 February 2012 2Lafarge UK Pension Plan

Your Lafarge Pension

� Depends on length of pensionable service

and Final Pay pensionable service

� PensionBuilderplus contributions

� Additional Voluntary Contributions (AVCs)

� Early Retirement, redundancy,

- Reduction Factor may apply


LUPP Pension - Example

Pensionable Service 20 Years

Final Gross Pensionable Pay £25,194

Less Lower Earnings limit £5,044

Final Pensionable Pay £20,150

Scheme Pension

20/60 x £20,150 = £6,716 per annum


BCRP and Alignment Pension -

Example

Pensionable Service 20 Years

Final Gross Pensionable Pay £25,194

Less Lower Earnings limit £5,044

Final Pensionable Pay £20,150

18 x 1.75% x £25,194 = £7,936

+

2/60 x £20,150 = £671

Total Pension = £8,607 per annum


Early Retirement

� Immediate Pension

�Early Retirement Reduction 4% per annum

�Tax Free Lump Sum Option


Tax Free Lump Sum Option

� Exchange part of your

annual pension for a one-off

tax free lump sum

� Normally 1/4 (25%) of the

value of your Pension


Pension pa x Actuarial Age Factor = Fund Value

£6,716 pa x 4 = £26,864

Pension pa Reduction for Cash Lump Sum Option

Lump Sum £26,864 ÷ by Commutation Factor 12 = £2,238 pa

Pension = £6,716 pa

or

Residual Pension = £4,478 pa

Plus a Tax Free Cash Lump Sum of £26,864

Tax Free Lump Sum Option - Example


Deferred Pension and PensionBuilderplus

Tax Free Lump Sum

� Final Pay Deferred Pension £9,000 p.a.

� Projected PensionBuilderplus account £52,000

� Tax Free Cash From Final Pay 9,000 x 4.54 = £40,860

� Tax Free Cash From PB+ 52,000 x 25% = £13,000

� Total Tax Free Cash = £53,860

� Final Pay Benefits

� Tax Free Cash Sum (£53,860 - £52,000) = £1,860

� Reduced Plan Pension £9,000 – (£1,860 ÷ 14.30) = £8,870 p.a.

� PensionBuilderplus Benefits

� Tax Free Cash Sum = £52,000


Tax Free Lump Sum (or more Pension)

� Advantages

� Tax free lump sum

� Taking cash reducesyour taxable income

� Taking cash does not reduce dependant’s pension

� Puts you in control and offers flexibility, (spending, debt, etc.)

� If you think you will not live long you may wish to have more money available now

� You may invest money and achieve a higher net income

� Make gifts while planning for estate and inheritance tax purposes

Dis-advantages

� You may not be able to afford to live on reduced income

� Loss of potential future increases on pension given up for cash

� You may consider exchange terms unattractive

� If your family tends to live longer than average

� If you are not good at managing money and fear that a lump sum may be unwisely invested or spent too quickly


Flexible Pension Option – For Former Blue Circle Retirement Plan Members Only

� Additional Flexible pension element paid temporarily until age 65 only

� State Retirement Pension payable by the government from State Pension Age

� Cost of this option is a reduction in immediate Plan Pension now and for the rest of your life

� If chosen this option will not affect spouse’s pension


Diversion of Redundancy Pay

� First £30,000 of Redundancy payment is currently tax free

� Amount over £30,000 is taxable (annual earnings limit)

� Amount transferred to Pension must be taken as ‘Tax Free Cash Sum’

� Additional Pension income cannot be purchased

CARE: - Annual Allowance limit of £50,000 may restrict the tax effectiveness of this option


Your Pension Options

� Option 1 - to receive benefit in annual pension only, Final Pay pension from Lafarge, PensionBuilderplus pension from chosen

insurance company.

� Option 2 - to receive the maximum cash sum available and a reduced pension. PensionBuilderplus account paid as part of the tax free cash sum.

� Option 3 - to receive a cash sum less than the maximumavailable and a higher reduced pension than option 2.

� Choose Maximum Flexible Pension Option – (BCRP only)


Retirement Declaration Form - Life Time Allowance (LTA)

� LTA % Calculation for Lafarge Pension

� Check that LTA maximum is not

exceeded - £1.5 million (2012/2013)

� Keep information safe as it may be

required on future tax returns


Payment and Tax

� Tax Free Cash Sum paid direct in to bank

account

� Annual Pension paid monthly with first

month pro-rata if applicable

� Bank / Building Society Account

� If P45 is not available, Basic Rate (BR) tax at

20% will be deducted until a new tax code is

issued


Death After Retirement

� Widows/er pension is usually 50% of pre-

commuted pension (before cash exchanged)

- a reduction if spouse is more than 10 years younger

� Increases - same as member

� Paid - same as member

� Balance of 5 year guarantee

� Nomination Form should be kept up-to-date


Pensioner Communications

� Monthly Pay Advice (only if requested)

� P60 Tax and Pay Certificate

� Summary Report & Accounts (PensionsTalk)

� Exclusive Telephone Helpline

� Website: www.lafargeukpensions.com

� Pensioner magazine (In Touch) annually

� Contact Link Scheme

(01306) 872100


Retirement Process

� Pension estimate given

� Final calculation of actual pension may not

begin until receipt of disinvested

PensionBuilderplus contributions

� Choose option on Pension Payment Authority Form

� Payment cannot begin until Retirement Declaration Form and bank details are received

� Tax-free lump sum paid direct into bank account


Retirement Process - continued

� Letter to pensioner to confirm chosen option

• Monthly payslip sent to home address (if requested)

• Pension from Lafarge paid monthly

• PensionBuilderplus pension paid by insurance company – as you requested

• If P45 is not available, Basic Rate tax (20%) will be deducted from pension until a new tax code received

• Pensioner Telephone Helpline 01306 872100


Pensions Consultative Council (PCC)

Type Constituency Number of

representatives

1 Cement 2

2 Aggregates & Shared Services 3

Em

plo

yee

rep

rese

nta

tives

1 Ex-Lafarge Redland Pension Scheme 2

Pen

sion

er

rep

rese

nta

tives

1 Non-Lafarge Redland Pension Scheme 3


Lafarge UK Pension Trustees Ltd

Directors

� Independent Chairman - Norman Braithwaite

� Employer Directors- Dyfrig James (President UK Cement,

Aggregates, A&C, Paving)- Nick Peall (Cement HR Director)- Jenny Honeysett (Cement Financial Controller)- Bob Andrews (Executive)

� PCC Directors- Paul Hunter (Cement)- Steve Taylor (Aggregates)- Lynn Clarke (Shared Services)- Arthur Cunningham (Pensioner)


Regulators

COMPLAINTS PROCEDURE

� Internal Dispute Resolution Procedure (IDR)

� TPAS - The Pensions Advisory Service

� Pensions Ombudsman

TPR – The Pensions Regulator

� PPF- Pension Protection Fund

DATA PROTECTION REGISTRAR


How can I trace an old pension?

� If you think you have contributed to a private pension before but have lost touch with the pension provider, the Pension Tracing Servicecan usually help by tracing it for you.

� You can call them Monday to Friday from 9am to 5pm on 0845 6002 537

Pension Tracing ServiceThe Pension Service

Tyneview ParkWhitley Road

Newcastle upon TyneNE98 1BA

Documents

Your Lafarge Pension - Lafarge UK PensionsSeminar... · Lafarge UK Pension Plan 20 February 2012 2 Your Lafarge Pension Depends on length of pensionable service ... Your Lafarge Pension