Final Salary Pension Transfers Guide

A final salary pension transfer gives you control of a significant financial asset. Download our free comprehensive final salary pension transfers guide to understand the potential benefits, risks and the issues involved. We are authorised and regulated by the FCA and operate UK wide.

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A final salary pension scheme provide a guaranteed income for life with little risk and with minimal effort required by the pension holder. These significant benefits should not be given up without careful consideration. We have included below some of the most common questions we receive about Final Salary Pension transfers.

Frequently Asked Questions

What’s changed to make final salary pension transfers more attractive?

There are two main issues.

First, in September 2014 the Chancellor announced significant reform to the way in which personal pensions are treated on death. Under the new rules, when a saver dies the value of their pension can be passed on to beneficiaries tax-free. If the saver is under age 75 at the date of death then not only is the benefit free from inheritance tax but withdrawals from the fund are tax free. If the saver is aged 75 or over the benefits are free from inheritance tax but withdrawals are taxed at the marginal rate of tax.

Secondly, potential transfer values are at an all time high.


How Do I check my final salary pension value?

To obtain a final salary pension value (transfer value) you need to write to the pension scheme administrators. The administrators details will be quoted in the scheme booklet you received when you joined the scheme. If the scheme documentation has been misplaced the administrators details can be found using

Once you have contacted the administrator it generally takes them up to six weeks to deliver the requested information. The administrators generally provide one free transfer value calculation in any twelve month period. The value supplied is valid for three months to allow you time to consider your options.


Are there any charges if I transfer from a final salary pension scheme?

Transfers from final salary pension scheme’s do not usually attract penalties although transfer values can be reduced to reflect the funding position of the scheme and protect the remaining members so it’s always important to check if one applies in your case.


What if I change my mind after a Defined benefit pension transfer?

Once you have committed to a transfer the trustees of the scheme are under no obligation to take the transfer back and in most cases refuse to do so and any benefits your scheme may have provided will be lost forever. It is therefore essential to take Independent Financial Advice when considering a transfer. That advice should come from an Adviser with experience of Defined Benefit (Final Salary) pension transfers and with the appropriate FCA approvals.


What is critical yield?

The “critical yield” figure provides guidance on how much your investments will need to achieve (after transfer) to match what you would have received from your final salary scheme. It therefore delivers an indication of risk. If the critical yield shows you that the rate of return required is at or around the returns that could be achieved from low risk investments such as Gilts then the risk is low. However, if to achieve the critical yield potentially higher risk investments are required then the risk is higher.

It should be noted that critical yield is not a perfect measure and it does have its drawbacks but it is a useful indicator.


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