As part of their response to COVID-19, the government plans to temporarily suspend significant tax charges on pension income for recently retired public sector workers aged between 50 and 55 who are returning to work to assist in providing critical public services. 

The current rules provide that, where an individual with a protected pension age between 50 and 55 retires and takes benefits before they reach the age of 55, they lose that protected pension age if they are later re-employed by their former employer, unless specific exemption conditions are met.

Losing the protected pension age turns the pension income received into an unauthorised payment, taxable at up to 55%. Since most returning workers will be re-employed by their former employer, in many cases the NHS, to undertake similar work to what they were doing before they retired, they are unlikely to meet the conditions for exemption from these tax charges.

The proposed changes to the rules will reinstate the age protection for such workers, so removing the tax charge and will initially apply to pension payments made between 1 March and 1 June 2020. The changes were first introduced for doctors and nurses but are now to be extended to all public sector workers such as police, fire service and other uniformed service workers, who are returning to work specifically as a result of COVID-19.

Links

COVID-19: Government support tracker
This tracker covers measures announced by the government to support individuals and businesses, as we get through COVID-19.

Pensions: Unauthorised payment charges (subscriber)
What is a pensions unauthorised payment? When does a tax charge arise? Who pays the charge?

External Link

HM Treasury statement  

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David- the age at which you can access your pension is 57, same for everyone (or 55 for older people.) You will suffer a loss of 4% a year for doing so, so can retire at 57 on about 56% of your pension. As you are in your 30s, I recommend you...

David- the age at which you can access your pension is 57, same for everyone (or 55 for older people.) You will suffer a loss of 4% a year for doing so, so can retire at 57 on about 56% of your pension. As you are in your 30s, I recommend you take advice and consider saving more now!

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Just like to point out that my retirement age is currently 68, and climbing.

So, why exactly are public sector workers allowed to retire and take retirement benefits before 55?

Being in my 30s, I'm pretty sure my generation will not live as...

Just like to point out that my retirement age is currently 68, and climbing.

So, why exactly are public sector workers allowed to retire and take retirement benefits before 55?

Being in my 30s, I'm pretty sure my generation will not live as long as the previous generations in any case - due to a combination of relatively poor diet / sedentary lifestyles, overpopulation and the increase of medically resistant diseases thanks to our society's overuse of antibiotics etc.

Yet all the actuaries etc continue to extrapolate that we will all live well into our 90s, based on the colossal assumption that longevity will continue to increase along the same curve as it has historically.

Why on earth did I have to be born in this bonkers era...

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The BMA gives a few details which apply in the NHS of people taking retirement from 50 on:

https://www.bma.org.uk/pay-and-contracts/pensions/leaving-the-nhs-pension-scheme/taking-early-retirement

A broken system.

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