Purchase / Transfer SPS Pension Scheme

Purchase and Transfer SPS Pension Scheme

The DPER Circular 15/2019: Purchase and Transfer of Retirement Benefits under the Single Public Service Pension Scheme is now available here.  This Circular sets out details of the new facility for the Purchase and Transfer of Retirement Benefits in the Single Scheme. Please note the effective date of this Circular (and therefore of the facility) is 1 October 2019.

Purchase of Additional Benefits Guide

Transfer In of Pension Benefits Guide

 Single Scheme Member Purchase / Transfer Calculation Tool:

The Single Scheme Member Calculation tool is a spreadsheet based calculator designed to give active Single Scheme members an indication of the cost of purchasing additional benefits under the Scheme provided for by regulations made in S.I. 252 of 2019. The calculation tool can also be used to calculate the value of benefits transferable into the Single Scheme from another Revenue approved occupational pension scheme.

 Note: This calculation tool does not calculate the limits that apply to a Scheme member’s purchase/ purchase by way of transfer. You should email pensions@universityofgalway.ie if you wish to formally initiate the purchase of additional benefits under the Single Scheme or make formal arrangements to transfer benefits from another Revenue approved occupational pension scheme into the Single Scheme. Please include a screenshot of the calculation tool values generated.

Before considering entering into an agreement to purchase referable amounts under this Circular Scheme members should:

1. Ensure that all of their prior service in the Single Scheme, including service with other Relevant Authorities, is reflected in their pension record. Members who had previously been members of the Single Scheme and received a refund of contributions prior to vesting and subsequently re-joined the Single Scheme within two years of departure may also wish to consider restoring those refunded amounts, with compound interest in accordance with Section 17 of the 2012 Act before entering into a purchase contract under this Circular.
2. Seek independent financial advice before entering into a contract for the purchase or transfer of benefits. Ultimately any decision to enter into a contract for the purchase of additional benefits is a decision for the member.

Eligibility for Purchase

Conditions that must be complied with by Scheme members who are eligible to purchase referable amounts:

 -          Scheme members must have completed the vesting period

-          Scheme members must have the potential to complete a period of 9 FTE years as a member of the Single Scheme by the time they reach their normal retirement age  (including membership before purchase). When calculating the number of years as a Scheme member for a part time worker, it should be assumed that the member’s current work pattern would continue to NRA

-          While the facility to purchase is available to both contract and permanent employees, for a Scheme member on contract, the term of the contract must be such that along with membership of the Single Scheme in the past, the Scheme member would have the potential to complete a period of 9 FTE years as a member of the Single Scheme by the time they reach their normal retirement age.

Purchase Facility Features

Purchase Facility Features

Eligible members can choose to purchase:

• Additional pension only
• Additional lump sum only OR
• A combination of Additional pension and Additional lump sum

1. Purchase agreements will operate on a twelve-month basis (NUI Galway January - December)
2. A Scheme member can enter into one contract in the period of 12 months
3. Subject to the limits provided for in this Circular, a Scheme member can enter into any number of 12-month purchase contracts over his/her period of membership of the Single Scheme, although no two contracts can overlap
4. The limits on purchase, as set out in Para 8.2 are determined on the basis of the lower amount resulting from the calculation of two formulae
5. The limits referred to above must be re-calculated in respect of each individual contract
6. Referable amounts may be purchased by way of one lump sum payment only
7. A Relevant Authority can set its own notice period for the receipt of applications for purchase

Eligibility for Transfer

Conditions that must be complied with by Scheme members who are eligible to transfer existing retirement benefits:

 -          Scheme members must have the capacity to become vested members of the Single Scheme before they reach their normal retirement age.

Transfer Facility Features

Transfer Facility Features

Eligible members can choose to purchase:

• Additional pension only
• Additional lump sum only OR
• A combination of Additional pension and additional lump sum

1. The transfer will be effected directly between Pension Trustees i.e. between the Scheme member’s current Relevant Authority and the Trustees of the Scheme, PRSA provider or BoB/PRB provider where the retirement benefits are originating
2. All transfer values relating to a previous employment, PRSA or BoB/PRB must always be included in the purchase of referable amounts by way of transfer. No split transfers are permitted. For this reason, Scheme members should be aware that in cases where the transfer value exceeds the cost of purchasing the maximum amount of pension/lump sum referable amounts permitted for the individual member under this Circular, this would result in the balance of the transfer value being lost to the member
3.  Subject to the limits provided for in this Circular, Scheme members who are transferring retirement benefits may enter into one or more contracts in any 12 month period, where separate previous employments, PRSAs or BoBs/PRBs are involved. The limits provided for in this Circular must be re-calculated in respect of each individual contract
4.  Subject to the limits provided for in this Circular, Scheme members who enter into a contract(s) to effect a transfer(s) are permitted to enter into a purchase contract, as provided for in Para 4 above, within the same 12 month period but the limits provided for in this Circular must be re-calculated in respect of each individual contract
5. Taking account of the limits set out in this Circular and the rule that no split transfers are permitted, members should pay particular attention, with the help of independent financial advice if necessary, to the sequence of purchase contracts, where both actual purchase and purchase by way of transfer are anticipated by a member.
   

    

   Note: The transfer of retirement benefits accrued under pre-existing public service pension schemes is not permitted under this transfer facility. Preserved benefits in pre-existing public service pension schemes will be available to former members of such schemes at preserved pension age in the normal course.

   Advice from Department of Public Expenditure & Reform re Transfers from a UK USS pension scheme to the SPS

   “Pension transfers out of the UK can only be made to a Qualifying Recognised Overseas Pension Scheme (QROPS). The Single Scheme is not a QROPS scheme. This means that under HMRC (UK Revenue) rules it is not currently possible for Single Scheme members with pension benefits in the UK to transfer those into the Single Scheme. If the Single Scheme gains QROPS status in future, this will be communicated to Relevant Authorities.”