Originally Posted by
Easy Street
SP,
1) The Budget announcement definitely doesn't help the majority of HM Forces personnel affected by the annual allowance. As your second post correctly identifies, the change is only to the thresholds which define the taper of annual allowance down from £40,000. Great news for 2*, 3* and 4* but no help for the rest of us. The reason why the Government has done it is to address the crisis among senior doctors, where salary top-ups resulting from overtime and private work triggered tapering, massive annual allowance breaches, and led some senior doctors to refuse all overtime and even retire early. A salutary tale of how taxing thin air had immediate and negative effects. The £40,000 still applies and reaches further down the rank scale (in the NHS, too).
2) The AFPS15 final pension accrues at 1/47 of annual pensionable salary. Multiply that fraction by 16 to find the notional uplift in your pension pot. So to achieve an annual input of £40k you'd need a pensionable salary of (40,000)*(47/16) = £117,500. [Health warning: it's a lot more complicated than that in reality. Promotions and time served will add AFPS75 benefits, increases in salary will add AFPS05 benefits, and your pre-existing AFPS15 pot grows in line with average earnings. All this eats into the £40k allowance before you start adding your AFPS15 input, although permitted CPI growth offsets some of it. Then you can carry forward unused allowance from the preceding 3 years...].
Hi Easy - fully agree with your para 1.
Not sure about your para 2 - The guidance I've seen elsewhere gives the 63% figure (also earlier in this thread) based on a representative pension with equivalent benefits. I also think there was some guidance on the Forces Pension society pages so will try and link to that later. I certainly know guys on less than £117k who have received the letter from Veterans UK. For me, I've only got my AFPS15 'contributions' to calculate and I managed to obtain a figure for 2018/2019 by requesting one from them. I'll do the same for 2019/2020 and provide the figures once supplied.