Pensions Flashcards
How much is the state second pension?
Roughly £27 for men £14 for women
How much do state pensions grow each year?
Max of 2.5%, average annual salary or CPI
How much will the single tier pension be?
No less than £151 per week (rising the same amount as the old state pension)
How many years NIC are needed to get a state pension?
35 years for new single tier scheme
How much NIC is charged on a salary?
12% of earnings up to £815
Additional amounts are charged at 2%
What are the two main types of pension schemes?
Defined benefit
Defined contribution
What did the pension act 2004 do?
It will pay up to £33000 if the employer becomes insolvent and requires scheme to have solvency requirements
What did the workplace pension reform do?
Introduced auto-enrolment for anyone over the age of 22
Have 8% of salary going into the pension plan
What are the pension contribution limits?
Higher of 100% or £3600
Annual tax free exemption of £40000
Lifetime tax free exemption of £1m (by 16/17)
How much lump sum can someone take from their pension pot?
25% tax free
But all can be taken as cash- no longer annuity requirement
What types of annuity are there?
Escalating benefit
Joint life annuity
Enhanced rate annuity
Impaired life annuity
How much is the basic state pension?
£112 per week for those who made enough NIC
£224 for married couple who made enough NIC
£70 is spouse made enough NIC but you didn’t
