Corporate pensions

Transferring out of your company pension plan

If you’re considering transferring your company pension plan, we’ll be happy to help. It’s important to note that once we’ve been told what you’ve decided to do, you may not be able to change your mind. Please be sure you understand all your options, and the effect of any changes you make. There are a few things you should think about before you make any decisions.

If you have any questions once you’ve read this summary, or need any help understanding your options, either speak to your HR department or call us on 0808 234 3030, or +44 178 644 8844 if you’re calling from abroad.

We might record your call for training and quality purposes. To find out more about how we use your personal data please visit pru.co.uk/mydata.

How a company pension plan works

There’s a variety of pension plans available. They’re designed to provide a tax-efficient way of helping you to build up a pension pot to provide for your retirement.

Payments might be made into your plan by you, your employer, or both of you. Pension plans offer tax relief on your payments, subject to certain limits.

Your money will be invested in funds looked after by fund managers, who try to achieve the best returns possible. Any growth in your plan will be largely tax-free too. A charge is taken for managing your plan. Details of your fund choices and charges can be found in your annual statement. If you don’t have your annual statement or you’ve lost it, you can request a new one. Just call us.

In most cases, when you take your benefits, you can take up to 25% of your plan tax-free and the remainder will be taxable.

You might need to pay tax depending on your circumstances and the options you choose. Tax rules can also change in the future. You may want to seek advice.

Things to consider before making your decision

There are a few things you should think about before transferring your plan:

• Any guarantees, benefits and options under your existing plan may be lost and this could affect the benefits you receive.
• You may lose out on future employer contributions to your plan.
• The features and investment options of another plan may be different to this plan. You should consider if they will meet your needs and requirements.
• Charges may be higher or lower from those you pay now.
• There’s no guarantee another plan will perform any better than this plan.
• Transferring out of the With-Profits Fund could result in a market value reduction causing the value of your plan to fall and the loss of future bonuses.
• It can take time to transfer between plans causing a potential loss of investment growth while the transfer is completed, as your money won’t be invested.
• There may be an exit charge for leaving your plan.
• You may not be able to change your mind.

The value of your investment can go down as well as up so you might not get back the amount you put in.

Please also remember that the transfer value of your plan may not be the same as its current value - ask us for a transfer value before making your decision.