This note is addressed to the SPPA as administrator of the National Health Service Superannuation Scheme (Scotland) (NHSSS or Scheme). It sets out how a benefit reduction should be calculated in certain circumstances such as retirement or transfer, following an individual's election to exercise the Scheme option in respect of tax charges incurred due to the annual allowance (AA).
No factors or advice issued in the past for the NHSSS should be used for Scheme Pays calculations. No advice or factors issued for the NHS Pension Scheme (Scotland) 2015 (NHSPSS 2015) should be used for reductions to NHSSS benefits.
The following changes have been made when reviewing this guidance:
- Important information around the expected audience for the guidance, use of the guidance, review of factors, compliance and limitations applies across all sets of guidance. Rather than being repeated in each set of guidance, this can now be found on the scheme home page. It is important to read this information alongside the guidance.
- Calculation methodology: No changes have been made to the calculation methodology.
- Examples: There are no examples in this guidance. Worked examples, using the calculation methodology, can be found in prior versions of the guidance (though please note that these use historic factors).
- Factor tables: The "Factor Tables" tab contains the names of the tables that are referenced in the calculation methodology. The tables of factors themselves can be found in the most recently published "Consolidated Factors Workbook" which is available by clicking the "Download current Consolidated Factors Workbook" button on the scheme's home page.
- Assumptions: The key assumptions underlying the factors in each note are contained in the Consolidated Factors Workbook.
- Regulations: The regulations that require the production of the actuarial factors and/or guidance that is the subject of this note are summarised in the "Regulations" tab.
This guidance note should only be used for calculating the reduction to benefits following an election to utilise the annual allowance Scheme Pays mechanism. It should not be used for any other purpose.
This guidance note does not cover the method for determining the amount of any annual allowance charge.
As a result of McCloud remedy, some members may have a new or revised annual allowance tax charge for one of the years during the remedy period (2015 - 2022) which may be determined/notified to the scheme after the date of publication of this guidance. This guidance is not to be used to determine debits in relation to any such charges, please refer to the separate guidance on Scheme Pays for McCloud eligible members for the correct approach.
