Deferred members of the NHSPS are generally entitled to voluntarily take a transfer value to another pension arrangement. However, this right generally only applies to transfers to defined-benefit schemes from 6 April 2015; transfers to defined-contribution schemes and overseas schemes are prohibited.

This guidance covers transfers that are not made under the Public Sector Transfer Club arrangement (i.e. it covers non-Club transfer values or 'CETVs').

The circumstances under which members are entitled to take a CETV are set out in the scheme's regulations. Members with over three months' qualifying service would generally be entitled to take a CETV to another HMRC registered scheme. Members with less than 3 months of qualifying service would normally be entitled to a refund of contributions.

The following members do not have a right to a CETV:

• members in active service (unless they opt out of the Scheme and become deferred members). This includes transitional members whilst they are active members of the NHSPS 2015
• pensioners (in respect of the pension to which the member has become entitled)
• pension credit members (in respect of rights that are directly attributable to a pension credit)

A member with at least 2 years of qualifying service is generally entitled to a CETV at any time before their NPA (payment is required by NPA). A member with less than 2 years of qualifying service must exercise their right to take a CETV within 12 months of joining a new scheme (and they must join this new scheme within 12 months of leaving the NHSPS).

The calculation date used to calculate a CETV is defined as the 'guarantee date' in The Occupational Pensions Schemes (Transfer Values) Regulations 1996. This date is relevant for the purposes of determining a member's age (taken as age last birthday at guarantee date in complete years) and for applying revaluation (from date of leaving to guarantee date).

The NHSPS has six months from the guarantee date (or if earlier the date on which the member reaches age 60 (for 1995 section members) or 65 (for 2008 section members)) to pay the CETV. If payment is not made within six months then the CETV value should be paid in accordance with scheme regulations. Generally the amount payable is determined as the greater of the CETV recalculated as at the actual payment date or as the original CETV at the guarantee date increased at 1% pa above the Bank of England base rate to the payment date.

The deferred benefits (member's pension, separate lump sum (if applicable) and survivor's pension) to be valued should include revaluation to the guarantee date (except where the member has reserved rights for service before 29 January 1988 who should be treated as described in the relevant section below). The accrued benefits should be calculated at the last day of service, and then increased in line with Pensions Increase (Review) Orders. Guaranteed Minimum Pensions (GMPs) should be increased in line with the Revaluation of Earnings (Section 148) Orders.

When calculating cash equivalents for divorce purposes, the benefits to be valued for an active member of the NHSPS are those that would be calculated if the member had left service on the date of the calculation (as specified by the Court, where appropriate) - either deferred benefits or the payment of immediate benefits if the member is over NPA. For a member with less than two years' of qualifying service the benefits valued are the deferred benefits at the date the member leaves the scheme that would be calculated if there was not a two-year qualifying period for deferred benefits.

The CETV should not be adjusted for market conditions.

NHSPS was contracted out of the State Second Pension (until contracting out ceased in 2016). The value of any liabilities earned after 5 April 1997 in a contracted-out scheme must be separately identified on transfer to an occupational pension scheme. The value of these post 1997 rights (known as section 9(2B) rights) should be determined using the same method as specified for calculating the CETV value but based on benefits earned in respect of service after 5 April 1997 only.

Although practitioners are not contracted out (by virtue of being self-employed), it is possible they have transferred-in contracted-out rights.

Previous guidance included an adjustment to a CETV that related to any service prior to April 1997 to reflect the inflationary increases on the GMP, which are the responsibility of the State Scheme after GMP Payment Age beyond any fixed scheme increases. This adjustment was removed in 2019 for all members reaching state pension age after 6 April 2016 following the requirement to equalise GMPs.

The factor for valuing the survivor's pension does not depend on whether or not the member has a partner (as at the guarantee date) who would qualify for a survivor's pension in the event of the member's subsequent death, i.e. a CETV should include an allowance for the value of a survivor's pension in all cases.

Members liable to an Annual Allowance charge can make an election requiring the Scheme to pay the charge on their behalf and for this to be debited against their pension benefits (referred to as 'Scheme Pays'). If a member has previously elected for Scheme Pays they will have a negative DC balance alongside their Scheme benefits. This negative DC balance must be netted off against the CETV calculated. Please refer to the Scheme Pays guidance for more details.

The formulae for calculating CETVs are set out below.

1995 members - Factors should be taken from Table TV1 or TV2 as appropriate

CETV = Accrued Pension x TV1A or TV2A

+ Accrued Lump Sum x TV1B or TV2B

+ Accrued Survivor's Pension x TV1C or TV2C

- NI modification x TV1E or TV2E

Points to note in using factors:

• Benefit factors are unisex and in all cases should be taken as applicable for the member's age last birthday in complete years at the guarantee date.
• "Accrued benefits" in the above formulae means benefits including revaluation from the date of leaving to the guarantee date.
• Accrued pension should include NPA 60 added years; the amount of added years should first be pro-rated, to allow for unpaid contributions, in accordance with scheme regulations.
• Accrued pension should also include NPA 60 additional pension; the amount of additional pension should first be pro-rated, to allow for unpaid contributions (if the member is paying by regular contributions), in accordance with Additional Pension guidance. If the member has purchased personal and dependant's pension, the purchased dependant's additional pension should be added into the survivor's pension.
• For members with NPA 65 added years or additional pension, a separate calculation should be carried out for that element. The above calculation should be carried out but modified to use NPA 65 factors, i.e. factors from tables TV3 and TV4.
• Accrued lump sum should include any added years unreduced retirement lump sum (the amount of added years unreduced retirement lump sum should first be pro-rated in accordance with scheme regulations).
• Survivor's benefit should correctly reflect their service-related entitlement as set out in the Regulations.
• The value of any money purchase AVCs should be added to the CETV calculated above, if these are to be transferred with the scheme benefits. Money-purchase AVCs may be transferred separately.
• Any negative DC balance due to Scheme Pays, calculated as at the guarantee date, should be netted off against the CETV calculated above.
• We understand National Insurance (NI) modification adjustments are no longer needed for CETV calculations. For administrative consistency, we have retained this element in the formulae set out below. However, all NI modification factors have been set to zero in the corresponding tables in the consolidated factor workbook.

Preserved special class members with entitlement to a CETV are treated as having NPA 60 for the purposes of this Note and thus tables TV1 or TV2 are appropriate, EXCEPT for those who left on grounds of redundancy and who retain an NPA of 55 on leaving service, where calculations should follow the same method as above but using NPA 55 factors (set out in TV5 and TV6).

The above method/factors are not applicable for active special class members aged 55 or over who qualify for an immediate pension without actuarial reduction and who are requesting a cash equivalent for divorce purposes. For such cases please refer to the Divorce Guidance.

The appropriate method of calculation depends on type of member as follows:

Male members other than Choice Optants

CETV = Accrued Pension x TV3A

+ Accrued Survivor's Pension x TV3C

- NI modification x TV3E

Female members under age 60 other than Choice Optants

CETV = Accrued Pension x TV4A

+ Accrued Survivor's Pension x TV4C

- NI modification x TV4E

Female members aged 60 or over other than Choice Optants

CETV = Accrued Pension x TV4A

+ Accrued Survivor's Pension x TV4C

- NI modification x TV4†F

Choice Optants

CETV = 'Post Commutation' Accrued Pension x TV3A or TV4A

+ Mandatory Lump Sum x TV3B or TV4B

+ Accrued Survivor's Pension x TV3C or TV4C

- (Relevant NI deduction as above)

Points to note in using factors:

• Factors should in all cases be taken as applicable for the member's age last birthday in complete years at the guarantee date.
• 'Accrued benefits' in the above formulae means benefits including revaluation from the date of leaving to the guarantee date.
• Mandatory Lump Sum in the formula above relates to the minimum lump sum Choice Optants are required to take through commutation of their pension. Correspondingly, 'Post-Commutation' Accrued Pension relates to the accrued pension reduced by commutation of the Mandatory Lump Sum.
• Survivor's benefit should reflect all service.
• The value of any money-purchase AVCs should be added to the CETV calculated above, if these are to be transferred.
• Any negative DC balance due to Scheme Pays, calculated as at the guarantee date, should be added to the CETV calculated above.
• Accrued pension should include NPA 65 additional pension (the amount of additional pension should first be pro-rated, to allow for unpaid contributions (if the member is paying by regular contributions), in accordance with Additional Pension guidance). Please note that there are no alternative payment ages in the 2008 section. If the member has purchased personal and dependant's pension, the purchased dependant's additional pension should be netted off against the Survivor's pension.
• When calculating a cash equivalent for divorce purposes a separate CETV should be calculated for service before and after 1 April 2008 for Choice Optants. See the latest version of the Divorce Guidance
• We understand National Insurance (NI) modification adjustments are no longer needed for CETV calculations. For administrative consistency, we have retained this element in the formulae set out below. However, all NI modification factors have been set to zero in the corresponding tables in the consolidated factor workbook.

The calculation of a CETV (i.e. non-Club transfer value) is subject to an underpin if the member has transferred benefits in from another scheme. This would not apply for a Club transfer value. If an underpin bites, the value of the underpin is payable instead of the CETV calculated as above.

The underpin is calculated using the following formula:

Underpin = Amount of transfer payment accepted by the NHSPS

+ the member's own contributions to the NHSPS

For Choice Optants

Underpin = Amount of transfer payment accepted into the 2008 section (if any)

+ the member's own contributions to the 2008 section

+ Amount of transfer payment accepted into the 1995 section (if any)

+ the member's own contributions to the 1995 section

Member contributions include those to purchase added years, added pension and unreduced retirement lump sums.

If a pension debit member requests a CETV, the quotation given should be based on the member's benefits after applying the debit i.e. the CETV should be the difference between a CETV based on the unreduced benefits revalued to the guarantee date and the pension debit benefits revalued to the guarantee date. The pension credit awarded to the ex-spouse remains in the NHSPS after a member exercises his/her right to a statutory CETV.

Transfers from the NHS Pension Scheme to a Recognised Overseas Pension Scheme (ROPS) listed on HMRC's website and subject to various requirements set out in the Contracting-out (Transfer and Transfer Payments) Regulations 1996 (SI 1996/1462) are generally no longer permitted.

The factors and guidance in this Note are not appropriate for members (such as active members or deferred members with entitlement to NPA 55 who were made redundant) who are entitled to immediate benefits with no actuarial reduction. For such cases, please refer to the Divorce Guidance.

If a member has accrued benefits in both sections of the scheme, their CETV should be calculated separately based on the benefit entitlement within each section and the results added together. A member with accrued service in both sections will be entitled to a CETV from the 2008 section even if they have less than 3 months' qualifying service.

If a member has accrued benefits in both the NHSPS and the NHSPS 2015, their CETV should be calculated separately based on the benefit entitlements within each scheme and the results added together. Such a member is not eligible to a CETV from the NHSPS if they are in pensionable service in the NHSPS 2015.

If a Special Class member (with an NPA of 55) is made redundant, they retain their right to an NPA of 55. Calculations for such members aged under 55 use the NPA 55 factors (set out in TV5 and TV6). For members aged over 55 please refer to 1995 members - Special class members.

A member who has opted-out of the NHSPS with entitlement to a preserved pension and has at least two years' service before 6 April 1988, may only take a CETV in respect of service after 6 April 1988. However, if the member leaves NHS employment before age 60, they will also become entitled to a CETV in respect of pre-6 April 1988 service.

There may be some male nurses who have taken the benefits accrued after 17 May 1990 on retirement after age 55, but have preserved the benefits accrued before 17 May 1990 to be paid at age 60. A CETV is available in relation to the preserved part of their benefits and may be calculated in line with this Note. For divorce purposes the approach outlined in the Divorce Guidance should be followed.

If a member has accrued service before 29 January 1988, that part of their CETV relating to service before this date will be calculated as described in NHS (Superannuation) Regulations 1980 if this would be more favourable to members. Such reserved rights are only available to members of the 1995 section who transfer their pension rights to either the 2008 section or another defined benefit occupational pension scheme. The 'reserved rights' CETV is calculated as set out below. This 'reserved rights' CETV plus standard CETV calculation for membership from 29 January 1988 onwards (determined in accordance with the specification for 1995 members in the paragraph above) is compared with the standard CETV for all membership (again determined in accordance with the specification for 1995 members in the paragraph above).

The CETV available for such a member would be the higher of the CETV for reserved rights (1980 Regulations method) plus CETV for post 29 January 1988 service (current method), and the CETV based on benefits earned over all membership using the current method.

Male Members

CETV = [ Pension at date of leaving x TV7A

+ Lump Sum at date of leaving x TV7C

+ Widow's Pension at date of leaving x TV7D

- NI modification x TV7B ] x Interest factor

Female Members

CETV = [ Pension at Date of leaving x TV8A

+ Lump Sum at date of leaving x TV8C

- NI modification x TV8B ] x Interest factor

Points to note in using factors:

• All benefits in the above calculation are those based on service pre 29 January 1988 and determined at date of leaving. No revaluation should be added to any benefit between date of leaving and the guarantee date
• Factors are sex-specific and should be taken as applicable to the member's age last birthday at the date of leaving the NHSPS (not age at guarantee date)
• For male members, the above calculation should only reflect widow's pension if the member was married at the date of leaving the NHSPS.
• The Interest factor is equal to a rate of 2.25% compound for each complete 3-month period from the day after leaving the NHSPS to the guarantee date.
• We understand National Insurance (NI) modification adjustments are no longer needed for CETV calculations. For administrative consistency, we have retained this element in the formulae set out below. However, all NI modification factors have been set to zero in the corresponding tables in the consolidated factor workbook.