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Document How is my NHS Pension benefit growth calculated for Annual Allowance?

Pension growth (or the pension input amount) is determined by first calculating the opening and closing values of your NHS Pensions Benefits in the pension input period (which is the same as the tax year, 6 April to 5 April).

The opening value is the value of your NHS benefits at the day before the start of the pension input period, which is increased by the change in Consumer Prices Index (CPI) from the previous September. It is calculated using the following formula:


Annual Pension x 16 + lump sum* (1995 Section only) + CPI%

 

The closing value is the value of your NHS benefits at the last day of the pension input period. It is calculated using the following formula:
 

Annual Pension x 16 + lump sum* (1995 Section only)

 

The following formula is then used to calculate the pension input amount:
 

closing value – opening value = pension input amount


If the pension input amount is more than the Annual Allowance, the excess amount may be subject to an Annual Allowance charge.

More information about Annual Allowance can be found on the NHS Pensions website.

*The separate lump sum would only apply to members of the 1995 Scheme. If you are a member of the 2008 or 2015 Scheme there would be no separate lump sum to add. This also applies to members who moved to the 2008 Scheme under the Choice exercise. Although those members do have to take a mandatory lump sum this will not be included in the Annual Allowance calculations.

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growth calculation, pension growth