Shropshire County Pension fund

Taking care of your Local Government Pension in Shropshire

Pension Scams

Pension scams are on the rise so if you are thinking of investing your pension benefits, or transferring them to another pension provider, be sure to protect yourself from scammers.

Although some pension schemes may appear professional, this is not always the case!

The risks of transferring your benefits to an illegal company may be very damaging to your future financial security. If you do fall victim of a scam, it is unlikely your money will be recoverable. You may also face a tax bill from HM Revenue and Customs (HMRC).

The Pensions Regulator has released a four step guide to help you protect yourself from pension scams.

You can also get further information and advice from Pension Wise and The Pensions Advisory Service (TPAS).

Pension Liberation

If you are paying money into a registered pension scheme your contributions receive tax relief. This means you don’t pay tax on the money you put into your pension account.

The pension tax rules state you can’t take your benefits before age 55, unless you are suffering from ill health. If you take your benefits before age 55, this is considered an unauthorised payment by HMRC and you would have to pay back the tax relief. This is known as Pension Liberation.

Pension Liberation should not be confused with ‘Freedom and Choice’. This allows members of Defined Contribution pension schemes, who are 55 or over, to access their benefits more flexibly. This includes the option to take all your benefits as a cash lump sum.