Army Pension Impacts on State Pension

[Ken Hannah]

Hi Pete,

Long time no speak.....you and pension query...you must be taking it home in a wheel barrow .......

Your questions is either simple to answer or complicated depending on your personal circumstance.

Basically your OAP is paid tax free, therefore the tax element you would pay on that sum (depends on your whole earnings 20% tax rate etc) would come off your army pension so that would reduce your annual army pension....out of one pot into another ...simple so far .....but there could be an abatement also due to the opting out of SERPS in the 70s (remember the 70s Pete!!!).....it is quiet complex relating to NI contributions and GMP regulations (Guaranteed Minimum Pension)..... It effects some guys and not others as you can't get the the calculation on both the service pay and the OAP....one or the other but not both....some had it miscalculated on both so their service pension will be reduced .....Google GMP...to complex for here...I think it I explained in the annual pension newsletter you get with your penion increase....clear as mud eh?
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Basic answer to your question is - yes receipt of the OAP can reduce your service pension....after all that it is only pennies or pounds a year.....so no problem for you - going back to the wheelbarrow scenario...however in my case.........!

Get yourselves down to Stoke for the next reunion for a catch up....with an OAP, NHS, and Army you can fly down in your helicopter....Take Care.
Regards
Ken