Kingfisher Pension Scheme Member Booklet - The Kingfisher Pension Scheme (the KPS) has been set up by the Company to help you save for your ...
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April 2019 Kingfisher Pension Scheme Member Booklet The Kingfisher Pension Scheme (the KPS) has been set up by the Company to help you save for your retirement.
April 2019 Introduction The Kingfisher Pension Scheme (the KPS) has been set up by the Company to help you save for your retirement. By joining the KPS you are making a valuable saving towards your retirement and receiving additional help from your employer through the contributions that it makes into the KPS for you. As an employee, you can join the KPS at any time. However, once you have worked for the Company for three months, you will be automatically enrolled into the KPS if you meet certain criteria, as explained on page 5. You could rely on State benefits, but they are unlikely to provide you with the income you would want to live on in retirement. We have tried to make this member booklet easy to follow so you can decide whether joining the KPS is right for you. Words that begin with capital letters have special meanings, and are explained on pages 26 and 27. You need to read this member booklet so that you understand what you are committing yourself to by joining the KPS and then keep it safe for future reference. This member booklet is effective from 1 January 2019 and is only intended to be a guide to your pension. Full details of how the KPS works are contained in the Trust Deed and Rules – the legal documents governing the KPS. In the event of any inconsistency between this member guide and the Trust Deed and Rules, the terms of the Trust Deed and Rules will apply. 2
April 2019
Contents
How does the KPS work?............................................................................................... 4
How do I join?.................................................................................................................. 5
Contributions into the KPS............................................................................................. 6
What is SMART Pension?............................................................................................... 6
Where can I invest?......................................................................................................... 9
Some of the investment terms explained.................................................................. 15
What do I get in retirement?........................................................................................ 16
What happens if I die?.................................................................................................. 19
What happens if I leave?............................................................................................... 20
Tax information............................................................................................................. 22
Legal information.......................................................................................................... 23
Help and advice............................................................................................................. 24
Definitions ..................................................................................................................... 26
Who to contact ............................................................................................................. 28
3
April 2019
How does the KPS work?
The KPS is a Trust based occupational scheme
which has a ‘money purchase’ or ‘defined
contribution’ section. This section applies to
where money paid in by you and the Company.
This pension savings are in your the performance of investments and
name and you can choose where you any cost of converting your pension
would like it to be invested from the savings into an annuity. THE MAIN BENEFITS OF BEING IN THE KPS ARE:
options that are available. • it’s a tax-efficient way of saving for your retirement
The Trustee has appointed Legal &
At retirement, 25% of your pension General to administer the KPS and to • the Company makes a contribution to your pension savings
savings can normally be taken provide access to the investment • you can make your own investment choices from the range of funds on
tax-free; anything not taken in that funds on behalf of the Trustee. offer
way must either be used to buy an
Annuity or can be used to provide an Please note that it is your • the KPS is set up as a trust which means that all the money held within
additional, taxable, cash sum. responsibility to make sure you are the KPS is completely separate from Company finances
Alternatively, you can transfer to a saving enough for your future by
• death in service lump sum of 4 x Salary.
registered pension arrangement that reviewing how much you are paying
provides access to flex-drawdown into the KPS and how your
(this means you can take a number of investments are performing.
cash lump sums).
You should remember that the value
The value of your retirement benefits of an investment may go down as
will depend on the amount of well as up and if investments go
contributions paid, any cost of down, the value of your pension
exercising any right to transfer the savings may be less than the
benefits, any charges payable, the contributions you have made.
age at which you access the benefits,
4
April 2019
How do I join?
You can join if you are a full-time or part-time
employee, and are over age 16. There is no
upper age limit on joining the KPS.
The Government has introduced • you have worked for the Company CAN I HAVE A PERSONAL PENSION become what is called an active
legislation which means that all for three months; AS WELL? member. Legal & General will then
companies in Great Britain and Yes you can but the Company will send you a member certificate
Northern Ireland are now required to • you are aged 22 or over; only contribute to the KPS. containing all your pension policy
automatically enrol certain details.
employees into a qualifying • you are under State Pension Age; CAN I TRANSFER PENSION
workplace pension scheme, which BENEFITS INTO THE KPS? You will also be able to access their
meets certain minimum legal • you work or usually work in Great It is usually not a problem for the online Manage Your Account service.
standards. Britain or Northern Ireland; KPS to receive a transfer from Manage Your Account allows you to
another pension arrangement, review your contributions, where
The KPS is a qualifying pension • you earn at least £10,000 per year although Trustee consent is needed. you’re investing your pension
scheme and in fact exceeds the (£833 per month)* If you want to do this, please contact savings and how well those
Government’s minimum standards. Legal & General with information investments are performing.
If you do not meet the criteria about your other pension arrangement.
You will automatically be enrolled for automatic enrolment, or wish to We recommend that you seek You will also be sent an annual
into the KPS if you meet all of the join before you are automatically independent financial advice benefit statement which will show
following criteria, enrolled, you may still join the before deciding to go ahead with what contributions have been paid
KPS on a voluntary basis at any any transfer. into your pension savings, your
time. Simply complete the online investment return and an estimated
Joining form (or download a forecast of the potential pension you
KEEPING TRACK OF YOUR PENSION
paper copy) available from Once you’ve joined the KPS and might receive when you retire (based
www.legalandgeneral.com/kingfisher. made your first contribution, you will on today’s money).
*Earnings criteria at date of publication.
5
April 2019
Contributions into the KPS
WHAT DO I CONTRIBUTE TO THE KPS? change your Member Contributions at WHAT IS SMART PENSIONS? Pensions, your Member Contributions
You must contribute a minimum any time and can do this by logging in SMART Pensions is an alternative will be made via the Non-SMART
Member Contribution of 5% of your to Manage Your Account and and often more cost effective way of Pensions arrangement as illustrated on
Basic Pay each month into the KPS completing the online Change of making contributions to the KPS. An page 7.
which will be matched by the Contributions Form. Alternatively, arrangement introduced by the
Company. you can download the form from Company on 1 July 2012, SMART
www.legalandgeneral.com/kingfisher. Pensions aims to save you and the 5 REASONS WHY SMART
Remember, if you’re a tax-payer the Company National Insurance PENSIONS MAY BE GOOD
real cost to you is less than you think The table below shows the Company contributions (NI). FOR YOU
because you receive tax relief on your and Member Contribution rates. • In many cases you pay less
contributions. By participating in SMART Pensions, NI so your take home pay
In most cases, after you have been a most active members of the KPS goes up and your income tax
You may wish to pay a higher member of the KPS for three months, reduce the amount of NI they would is not affected
contribution and receive higher your contributions will paid through otherwise pay and therefore increase
Company contributions. You can SMART Pensions. their take-home pay. However, a small • Your KPS benefits build up
number of members might not benefit in the same way
from SMART Pensions, and if you’re
You wish to pay The Company will pay Total Payment
in this group, you’ll be automatically • Death benefits remain the
5% 5% 10% excluded from SMART Pensions. same
6% 6% 12%
You also have the option to opt-out of • Your pay reviews, bonuses,
7% 10% 17% SMART Pensions by completing a allowances, commission,
8% or more 14% 22% SMART Pension opt-out form. This is overtime and mortgage
available from www.legalandgeneral. references are not affected
com/kingfisher
• Your basic State Pension will
If you choose to opt-out or are not be affected
automatically excluded from SMART
6
April 2019
HOW DOES SMART PENSIONS
WORK? Non-SMART Pensions SMART Pensions
This is how SMART Pensions works:
Annual basic pay: £25,000* Basic pay: £25,000
• Once you have been an active (used for all Company salary-related benefits)
member of the KPS for three Member Company
months, you stop making Member contribution contribution Contractual base salary: £23,750
Contributions into your KPS £1,250 pa
pension savings.
• The Company pays an amount
equal to your Member
Contributions directly into your
pension savings.
• In return, the Company reduces
your Basic Pay by an amount equal
to the Member Contributions it
makes on your behalf.
Pension: £1,250 Pension: £1,250
• This means in many cases you pay + Company contribution + Company contribution
less NI so your take home pay into your KPS-MP Company contributes into your KPS-MP
increases. Retirement Account £1,250 + Company Retirement Account
contribution
• The Company continues to pay its
usual Company Contribution.
NI on contributions No NI on contributions
Put simply, the same amount of money
goes into your pension savings for you
and in many cases both you and the *Note: For the purposes of the above example, annual basic pay is assumed to equal annual pensionable salary.
Company pay less NI contributions.
7
April 2019
CAN I CONTRIBUTE MORE INTO THE
KPS?
Yes in addition to increasing your
Member Contributions, provided the
Trustee agrees, you can choose to
pay Additional Voluntary
Contributions (AVCs) as a fixed
monetary amount or can make single
one-off contributions. Your AVCs will
not be matched by the Company.
Your AVCs are added to your pension
savings and invested in the same way
as your other contributions.
You can contribute as much as you
like towards your pension whether in
the KPS or any other registered
CONTRIBUTIONS AND FAMILY LEAVE Any death benefits that become Company will be based on the actual
pension scheme but there is a limit to
If you take maternity, paternity or payable whilst on family leave Basic Pay that you receive.
the tax relief available. This is known
adoption leave, you will continue to would still be based on the Salary
as the Annual Allowance and is
be an active member of the KPS. you would receive were you working Any death benefits that become
explained in the Tax Information
normally. payable whilst on other leave would
section.
For as long as you are being paid by still be based on the Salary you
the Company, even if you are being would receive were you working
You can change or increase your CONTRIBUTIONS AND OTHER LEAVE
paid less, the Company will continue normally.
contributions at any time. You can do For any leave other than family leave,
to pay Company Contributions to the
this by logging in to Manage Your you will continue to be an active
KPS based on the Basic Pay that you
Account and completing the online member of the KPS.
would receive were you working
Change of Contributions Form.
normally. Your own contributions are
Alternatively, you can download the For this period all contributions paid
based on the actual Basic Pay you
form from www.legalandgeneral. into the KPS by both you and the
receive during this time.
com/kingfisher.
8
April 2019
Where can I invest?
On joining the KPS your pension savings will
be invested into Lifestyle Cash Target, which is
the default fund for the KPS. See page 11 for
further details.
You can, however, change where you Investments are all about trying to Opportunity cost: the risk that you Inflation: the risk that your
invest your pension savings at any make the most of your savings and may miss out on potential returns by investments will not grow at the
time. balancing the risk of investments investing in lower risk funds, at a time same pace as inflation. If your
going down with the potential reward when you could consider taking a investment returns are lower than
Choosing where to invest your of the investments doing well. greater investment risk. This may inflation then the value of your
pension savings is a very important Different investment types have lead to a smaller pension. For pension savings falls in ‘real’ terms.
decision, as the amount of pension different levels of potential risk and example, if a member is fully invested This could happen if you invest in
you could receive in retirement will reward. Usually, funds with more in a money market or cash fund, the lower risk funds which may produce
partly depend on the investment potential for growth carry more risk. downside is potentially limited but so lower returns.
returns achieved. is the growth.
All investment funds carry risk which Conversion: when you retire, you
Bear in mind that this is a long-term can include: If that member had a long time may want to buy an Annuity with the
investment as it could be over 40 before retirement it could be argued funds in your pension savings. The
years before you access the money in Investment: the risk that the value of that he/she is missing out on the cost of buying an Annuity fluctuates
your pension savings. It is important your investments will fall in value. The growth that could be achieved and moves broadly in line with the
to review your investments longer there is until you retire, the through investing in a fund which price of bonds. You can help protect
periodically, especially if your less concerned you may be about targets a higher return by taking on against this risk by investing in funds
circumstances change. You may short-term falls in your investments greater volatility, because of the that invest in bonds as you approach
change your investment choice at and therefore you may be more impact of opportunity cost risk. retirement.
any time. willing to take a higher investment risk
for the opportunity of a higher return.
9
April 2019
You have a number of choices for adviser by contacting IFA Promotions This is done to try to protect your
where to invest your pension savings. at www.unbiased.co.uk. pension savings from the ups and
You can: downs of the stock market in the run
CHARGES up to retirement.
A. Invest in one of the Lifestyle We want to help you make the most
options of your pension savings so we’ve Moving your investments is done
or negotiated administration and automatically for you free of charge
B. Invest in one or more of the investment charges to help. and assumes that you will be retiring
individual funds available at your Selected Retirement Age. So,
The total expense ratio, or TER, if you invest in this option and are not
When you join the KPS, you will be represents the total cost associated planning to retire at this age you will
able to access Legal & General’s secure with investing in the fund. Some need to change your Selected
Manage Your Account service where elements of the TER will be deducted Retirement Date online or by
you can change your investments, directly from your Retirement contacting Legal & General.
review your fund value and see what Account, other elements will be
contributions have been paid in. You deducted from each investment fund There are two Lifestyle options for
can also call Legal & General directly if and is reflected in the unit price. you to choose from. The differences
you wish to make a change (please see between them relate to when the
‘Who to contact’ section). The TERs are shown on page 14 . The transition is made from higher risk to
TER can change from time to time, so lower risk funds, when the transition
Please note that, by law, neither the make sure you keep an eye on how starts and what the lower risk funds
Trustee, the Company, nor Legal & much it is and whether the fund invest and end in – see opposite.
General can advise you on your you’re in is still right for you. You can
investment choices. It should also be do that by looking at the fund The charges that apply to the
noted, that the default fund may not factsheet for each investment. You Lifestyle options will change as your
be the most appropriate investment can find links to these on page 14. money is moved between
choice for all members. If you are in investments.
any doubt about how you want to A. Lifestyle options
invest your pension savings we Lifestyling involves moving your You can see the charges that apply to
recommend that you seek advice from investments automatically from each of the underlying funds that
an independent financial adviser. You higher to lower risk funds the closer make up the Lifestyle on page 14.
can find a local independent financial you get to retirement.
10April 2019
LIFESTYLE CASH TARGET (THE KPS DEFAULT FUND)
There are two Lifestyle options for
100%
you to choose from. The differences
between them relate to when the
transition is made from higher risk to
90%
lower risk funds, when the transition
starts and what the lower risk funds
80%
invest and end in.
70%
The funds that the Lifestyle options
invest in are:
60%
• Passive Global Equity (inc. UK) Fund
50%
• Diversified Return Fund
40%
• Pre Retirement Fund
30%
• Lifestyle Fund*
20%
• Money Market Fund
10%
The charges that apply to the
0% Lifestyle options will change as your
15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 0 money is moved between
Years to selected retirement age investments. You can see the
charges that apply to each of the
Money Market Fund Diversified Return Fund Passive Global Equity (inc. UK) Fund Lifestyle Fund
underlying funds that make up the
Lifestyle on page 14.
* The Lifestyle Fund is made up of 50% Passive Global Equity (inc. UK) Fund and 50% Diversified Return Fund
(please see page 14 for more details on these funds). The overall charge for investing in the Lifestyle Fund is
0.41%, and the cost of investing in the lifestyle profile reduces in the approach to retirement.
11April 2019
LIFESTYLE ANNUITY TARGET If you choose one of the Lifestyle
options, all of your pension savings in
the KPS will be invested in this way
100% and you will not be able to choose
any other investment funds. You can,
90% however, switch out of Lifestyle at
any time.
80%
A Lifestyle Option will automatically
70% move your pension savings into
lower-risk funds as you head towards
60% your Selected Retirement Age.
Lifestyle options are designed to suit
50% the needs of most members saving for
their retirement, and so you may find
40% it is not suitable for your particular
needs. It may also not meet the
attitude to the risk you are prepared to
30%
take and return you expect.
20%
Lifestyle options work towards your
Selected Retirement Age. If you
10%
decide to take your benefits before or
after that age then it is not working
0%
towards your actual retirement date,
15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 0
as funds may not be switched at the
Years to selected retirement age
right time. So if you do choose stay
Money Market Fund Pre Retirement Fund Lifestyle Fund in the default fund, remember to
keep your Selected Retirement
Date updated.
* The Lifestyle Fund is made up of 50% Passive Global Equity (inc. UK)
Fund and 50% Diversified Return Fund (please see page 14 for more
details on these funds). The overall charge for investing in the Lifestyle
Fund is 0.41%, and the cost of investing in the lifestyle profile reduces
in the approach to retirement.
12April 2019
Please note that whilst you are ACTIVE MANAGEMENT aims to use
invested in the Lifestyle option, you analysis of the markets to achieve
cannot invest your pension savings above-average returns. The
account in the Self-Select funds investment manager will do this by
available. If you wish to invest in one choosing shares that are either
or more of the Self-Select Funds, you undervalued (to buy) or overvalued (to
can do so at any time but will need to sell) and choosing the right time to do
cease investing in the Lifestyle option. this. Actively managed investments
have the potential to bring in higher
B. Investing in a mix of funds returns than passively managed
There are two different approaches investments but they also carry a
to investments. higher risk of underperforming if the
investment manager’s decisions
PASSIVE MANAGEMENT (also prove unsuccessful. Actively managed
known as index tracking) aims to funds usually incur higher charges.
reduce the risk of poor share
selection in individual companies and The table on the following page
instead invest in most of the shows you the investment options
companies within a market/index you have with the KPS, whether
(e.g. the FTSE All-Share Index). they are passively or actively
In this way they aim to deliver managed and where each fund
returns that are close to the overall invests. The funds available may
market returns. change in the future.
13April 2019
You may want to
Total
Investment invest in this asset
Fund name Asset class Fund description Expense
approach class if you are
Ratio (TER)
concerned about
Passive Global This fund invests in a combination of funds which invest in stock markets around the
Opportunity cost,
Equity (inc. UK) Global Equity Passive world. To reduce the impact of currency movements on the returns generated by the fund, 0.47%
inflation risk
Fund 50% of its non-Sterling currency exposure is hedged back to Sterling.
Active Global
This fund invests approximately 30-40% in the shares of UK companies and the Opportunity cost,
Equity (inc. UK) Global Equity Active 0.96%
remainder in the shares of overseas companies. inflation risk
Fund
Diversified This fund invests in a wide range of assets, including company shares, high yield bonds, Opportunity cost,
Multi-Asset Passive 0.34%
Return Fund property, commodities and specialised alternative assets. inflation risk
Corporate
Pre-Retirement This fund invests in UK government bonds (gilts) and UK corporate bonds with an
Bond & Fixed Passive Conversion risk 0.30%
Fund average maturity period of 15 years or longer.
interest
Pre-Retirement
This fund invests in UK government bonds (gilts) where the interest payable on the
Inflation Linked Index-Linked Passive Conversion risk 0.30%
bond is linked to the rate of inflation.
Fund
This fund aims to provide a high level of security by investing in short-term money
Money Market market instruments and fixed deposits. While this is a low risk fund, no investment
Cash Active Conversion risk 0.32%
Fund strategy is without risk. As such there is a small chance this fund could have a negative
return.
Opportunity cost,
Ethical Fund UK Equity Active This fund invests in shares of companies that meet a set of ethical criteria. 1.08%
inflation risk
This fund invests in shares of companies around the world whose practices are Opportunity cost,
Shariah fund Global Equity Passive 0.56%
consistent with Shariah principles. inflation risk
Emerging Opportunity cost,
Global Equity Active This fund invests in shares of overseas companies located in developing countries. 1.25%
Markets Fund inflation risk
The fund aims to get the best return from a portfolio of first class freehold and Opportunity cost,
Property Fund Property Active 1.12%
leasehold interests in commercial and industrial property. inflation risk
14April 2019
Some of the investment terms explained
Equities are shares in companies traded on
stock markets in the UK or overseas.
They are affected by rises and falls in There are two types of gilts: fixed fixed deposits. They are expected to meeting certain social standards. For
their respective markets and their interest where the interest and capital provide lower returns over the long example, an ethical fund might
value can go up or down on a daily repayment are fixed in pound term than equities or gilts. Whilst exclude securities of companies that
basis. Historically investment in amounts; and index-linked gilts where money market instruments are low are known to practice discrimination,
equities has produced the best returns both interest and capital repayments risk, no investment is without risk and that operate in poor labour or social
in the long term. An equity fund can move in line with the price of goods as such there is small chance these standards, or that produce specific
invest in many different companies as measured by the retail prices index. funds could provide a negative return. products.
(and the global funds in different
countries) and in several business Corporate bonds are loans issued by Property involves investing in UK An alternative investment is a product
sectors. companies or non-government agencies offices, retail and industrial properties other than traditional investments
and work in the same way as gilts, where the return is generated from such as equities, bonds or cash.
Gilts are Government bonds – loans although they tend to give a slightly rental income and the upward or This term encompasses any non-
issued by the Government where the higher return than gilts as the risk of downward price of property. traditional asset class, and could
Government borrows an amount of companies failing to repay the loans is include investment vehicles such as
money for a specific fixed period. higher. They rise and fall in value over Shariah funds are designed to offer venture capital, hedge fund beta
Interest is paid on the amount their lifetime, but the price of corporate investors the opportunity to invest in (which seeks to replicate the return
borrowed and the capital is repaid at bonds normally moves in a similar way a manner which is consistent with you may generate from hedge funds),
the end of the fixed period. They rise to the cost of buying a pension and so Islamic Shariah principles in line with private equity, infrastructure and
and fall in value over their lifetime, but they are useful in protecting the the Dow Jones Islamic Titans 100 hedge funds.
the price of gilts moves in a similar purchasing power of your pension Index. The fund invests in company
way to the cost of buying a pension savings in the run up to retirement. shares from around the world. Please note, the Trustee has the power
and so they are useful in protecting to change the investment options
the purchasing power of your pension Money market funds invest in short- Ethical funds are those that limit their including the default fund, offered by
savings in the run up to retirement. term money market instruments and investments to securities of firms the KPS.
15April 2019
What do I get in retirement?
The KPS has been designed around a Normal Retirement Age of 65 with FLEXIBLE INCOME
a default Selected Retirement Age matching your State Pension age. You can spread the withdrawal of
your pension savings over a period of
time. If you would like to take your
However, you can take your pension Your options are: rest to buy a regular income. This will pension savings in this way you will
from the KPS after age 55 provided be treated as taxable income. need to transfer out of the KPS in
the Trustee and the Company consent. TAKE YOUR WHOLE PENSION order to do so.
SAVINGS IN ONE GO You can purchase an annuity through
You do not have to stop working for You can take the whole amount in any provider on the open market. You Different providers offer different
the Company in order to take your one go. Normally a quarter can be should always compare the various products which have different benefit
pension from the KPS. This is called taken tax-free – the rest will be taxed quotations to make sure the annuity options at retirement and you should
flexible retirement, but is subject to as income. If you’re considering this is right for you. check the product you choose is
the consent of both the Trustee and option, you may need to think about appropriate for your personal
Company. how you’ll provide an income for the How much pension you receive from circumstances and it is
rest of your lifetime. your Annuity will depend on: recommended that you take
independent financial advice.
GET A REGULAR INCOME • the value of your pension savings
You can use all of your pension at the time you retire Legal & General provide a product
savings to buy a lifelong, regular called a “Mastertrust” from which
income – also known as an Annuity. • the cost of buying an Annuity from drawdown is available. If you would
You can choose a regular income that an insurance company like to transfer to the Legal & General
increases with inflation and/or Mastertrust or would like more
continues to provide an income for a • the type of Annuity you buy information about this option you can
dependant after your death. go to www.legalandgeneral.com/
• your age when you buy your pensionaccess for further details.
You can also normally choose to take Annuity – generally the younger Please note that there is a minimum
a quarter of your pension savings as you are when you retire, the less investment of £30,000 in the
a tax-free cash payment and use the you will receive. Mastertrust.
16April 2019
The above is subject to legislative they pay – including the possibility better rates. Shopping around will • take a pension that increases each
requirements. How much is in your that they may have to pay a higher help to identify the highest income year
pension savings when you retire will rate of tax than normal. for your circumstances.
depend on the amount of • have a guaranteed minimum
contributions that have been paid HOW YOU BUY AN ANNUITY Using the open market option to shop payment period for your pension so
into the KPS over the years and the You have a choice about who around could make a big difference to that your pension is paid for a
level of investment returns achieved. provides your retirement income the pension that you end up receiving. minimum number of years even if
when you retire. You can either use you die within that period, or
TAKE YOUR WHOLE PENSION the Trustee’s appointed independent The Trustee has appointed an
SAVINGS AS CASH IN ONE GO firm or your own independent independent firm to help you find the • provide a pension for your spouse,
You will have the option of taking all adviser to help you shop around to most competitive quote for buying an civil partner or any dependants
your pension savings as cash, where choose the Annuity that best suits Annuity on the open market. after your death.
usually 25% will be tax-free and the your needs. Alternatively, you could go to an
remainder will be liable for income tax. independent financial adviser of your Once you have bought an Annuity
On average, people aged 55 today will Shopping around using what’s called own choice. with an insurance company you will
live to their mid-to-late 80s. It’s the open market option helps you to: cease to be an active member of the
important not to underestimate your The Trustee’s chosen annuity bureau KPS. The relevant insurance
own life expectancy. People • find out how the cost may vary will automatically contact you close company will be responsible for
considering this option should think between different providers to your Selected Retirement Age to providing your benefits.
about how to use the money to provide provide you with some open market
an income throughout retirement. • identify different features which options. TAX CONSIDERATIONS
may help you find the Annuity that The Lifetime Allowance is the
There will be tax implications if an best suits your circumstances Whichever way you choose to buy maximum value of pension benefits
entire pension pot is taken as cash in your Annuity, you will have a choice that you can accumulate without
one go. These will depend on an • potentially find a higher Annuity if about what type of pension you want incurring a tax charge. If the value of
individual’s personal circumstances. you are in poor health or if your to receive. You could: your benefits from all sources (i.e.
In most cases there will be a tax-free lifestyle may affect the cost of the other pension arrangements as well
amount available (normally 25%). Annuity. If you suffer from high • take all of your pension savings in as the KPS) is above the Lifetime
blood pressure, high cholesterol, the form of a pension Allowance, the excess will be subject
People considering this option should diabetes, are overweight or a to additional tax. If you think this is
consider their own personal tax smoker (or suffer from any of a • take up to 25% as a Pension likely to apply to you, you should
circumstances, and the impact of large number of other conditions), Commencement Lump Sum and seek independent financial advice.
taking a taxable lump sum on the tax you may be able to benefit from the rest as a pension
17April 2019
you can claim if you reach State 65 for men and 60 for women but
Pension Age on or after 6 April 2016. which is set to increase for both. This
change will be phased in by 2020. The
You’ll be able to get the new State Government plans to raise State
Pension if you’re eligible and: Pension Age further over the
following years, to 68.
• a man born on or after 6 April 1951
You can find out your State Pension
• a woman born on or after 6 April Age by using the online calculator at
1953 www.gov.uk/calculate-state-pension.
If you reached State Pension age STATE PENSION FORECAST
before 6 April 2016, you’ll get the State You can obtain an estimate of
Pension under pre 5 April instead. your State pension entitlement by
completing Form BR19, available
You’ll usually need at least 10 from your local Benefits Agency.
qualifying years on your National
Insurance record to get any State You can also apply for a State
Pension. They don’t have to be 10 pension forecast by telephone
qualifying years in a row. 0800 731 0175, or online at
www.gov.uk.
To receive the full State Pension you
Once your pension is being paid the take your benefits on retirement, these will usually need to have 35 qualifying PENSION WISE
income is taxable as earned income. options will be provided and explained years of National Insurance. This is a free and impartial
to you in more detail and you will Government service that helps you
For further information refer to the receive further information about your Full and further information about the understand your new pension options.
section on tax information on page 23. options from Legal & General and our State Pension can be found at
chosen annuity bureau. www.gov.uk/new-state-pension Please go to www.pensionwise.gov.uk
CHOOSING YOUR RETIREMENT for further information.
OPTIONS STATE PENSION STATE PENSION AGE
You do not have to make any The State Pension will be a regular State pensions are payable from State
decisions now. When you come to payment from the government that Pension Age, which until recently was
18April 2019
What happens if I die?
BEFORE YOU RETIRE It’s important to fill in a Beneficiary
The value of your pension savings Form when you join the KPS and
will normally be paid as a lump sum keep it up to date so that the Trustee
to your beneficiaries. Although, in knows who you would like the lump
some cases the Trustee may instead sum benefit to be paid to. The
use it to provide pensions for them. Trustee will take into account those
you put on the form, but is not
In addition, should you die whilst still obliged to follow your wishes.
working for the Company, and whilst This form can be printed from
an active member of the KPS, your the Trustee’s website www.
beneficiaries will receive a lump sum legalandgeneral.com/kingfisher or
of 4 x your Salary. you can complete an online form by
logging onto Manage Your Account.
Your beneficiaries for this purpose
are chosen by the Trustee. The Lump sums will normally be paid
Trustee can choose from a wide tax-free.
range of people including:
AFTER YOU RETIRE
• your family and their spouses This will depend on the type of
option you choose when you retire.
• your dependants For example, providing a pension on
your death for your spouse, civil
• a cohabiting partner partner or other dependant.
• anyone with an interest in your estate Full details on these options will be
and anyone specifically nominated by given to you when you retire.
you in writing – you can use a
Beneficiary Form for this purpose.
19April 2019
What happens if I leave?
LEAVING THE COMPANY If you are over the age of 55, you may The Trustee carries out these transfers information before proceeding with
If you leave the Company before retire from the KPS, subject to the from time to time, and will notify you the transfer. If the receiving scheme
reaching Normal Retirement Age Trustee and Company consent. in advance if a transfer of your benefits cannot provide this information the
then your pension savings will be left is proposed. You can expect to receive transfer may not proceed.
invested in the Scheme for future Please note, if you joined the KPS details explaining your options shortly
payment. before 1 October 2015, and have less after you leave the Company. OPTING OUT OR LEAVING THE KPS
than 2 years membership, you can BUT NOT THE COMPANY
You also have additional options. take a refund of the value of your TRANSFERRING OUT You can opt-out of the KPS by giving
Member Contributions paid via the One you have become a deferred notice to the Trustee.
You can transfer your benefits in the Non SMART Pension arrangements, member, you have the option of
KPS to another registered pension less tax. transferring out your benefits to a Simply contact Legal & General on
scheme.* registered pension arrangement. 0345 026 4179 and they’ll explain the
The Trustee may transfer your next steps to you.
benefits in the KPS into an individual You can transfer your benefits to:
policy with Legal & General in the Please note under the Automatic
future, and you will no longer be a • your new employer’s pension Enrolment legislation, the Company
member of the KPS (this will not occur arrangement; must automatically re-enrol you into a
until 12 months after you have left). workplace pension arrangement
• to an insurance company/provider; or between 6 months and three years of
If your benefit is transferred to an your opt-out date if you continue
individual policy with Legal & • to another registered pension to meet the eligibly criteria. Further
General, Legal & General will become provider of your choice. information regarding Automatic
responsible for all matters relating to Enrolment and how this may
your benefits. The rules and options Generally, the Trustee will allow you impact you should you opt-out is
for taking your benefits will reflect to transfer to most registered available on www.legalandgeneral.
the rules and options under the KPS. pension schemes, however the com/kingfisher.
Trustee will require certain pieces of
* The transfer amount will reflect the value of your chosen investments at the date the transfer is made.
20April 2019
If you opt-out of the KPS you will The Trustee or Company may change
have the same options as if you had this policy in the future.
left the Company but you will not be
able to take your benefits until you LEAVING DUE TO INCAPACITY
leave the Company (unless the If you have to retire (at any age) due to
Company and the Trustee agree). Incapacity, you may apply to use your
pension savings to buy an Annuity
Please note your life assurance and/or take a Pension Commencement
benefits will be affected if you Lump Sum as if you were retiring
opt-out of the KPS. The level of life normally. This is subject to the
assurance will be dependent on the Trustee’s approval and you satisfying
date you joined the Company. the Scheme’s definition of Incapacity.
In addition, if the Trustee approves,
• If you joined the Company on or you are still an active member of the
before 30 June 2012 your life Scheme and are below the Scheme’s
assurance benefit will be 2x Salary Normal Retirement Age, the Company
should you die whilst working for will increase your pension savings by
the Company. paying in an extra sum of money that
is equal to the value of the Company
• If you joined the Company on or Contributions into your pension
after 1 July 2012 your life assurance savings throughout your membership.
benefit will be 1x Salary should you However, this may be restricted if
die whilst working for the Company. your health condition existed before
you joined the KPS.
If you want to re-join at a later date you
may still be able to do this but you may If the Scheme’s medical adviser
need to provide medical information considers that you have less than
and the Company will need to agree to 12 months to live, you may be able to
you re-joining. Your Company service receive your pension savings as a
will be retained for contribution lump sum tax free, this is known as
purposes should you re-join the KPS. serious ill health lump sum.
21April 2019
Tax information
The KPS is registered with HM annual allowance tax charge on the TAX ON INVESTMENTS
Revenue & Customs for tax purposes. excess amount will be payable (except Pension funds pay less tax than many
As a result, contributions, investment if you are covered by HM Revenue & other types of investment. Your
returns and benefits enjoy favourable Customs’ “carry forward” option). pension savings will benefit from this
tax treatment, as outlined elsewhere tax efficiency.
in this guide. Please note, if your total earnings
plus pension contributions exceeds TAX ON RETIREMENT BENEFITS
HM Revenue & Customs has £150,000 your Annual Allowance will Under current tax legislation, if you
established allowances for the be tapered down. choose to take a Pension Comm-
amount of benefits an individual can encement Lump Sum upon
build up in a tax-efficient way in each Please note managing your tax situation retirement, this will be paid to you
tax year as well as over their whole in relation to the Annual Allowances is tax-free. Generally, you can take a
working life. your responsibility, together with the Pension Commencement Lump Sum
payment of any tax charges. The of up to 25% of the value of your
TAX RELIEF ON CONTRIBUTIONS Company and the KPS do not have full pension savings.
Your pension contributions usually visibility of all your pension
receive tax relief at the same rate that arrangements (and in particular any Any income that you receive in the
you pay income tax, up to the limit other pension, external income (e.g. form of a pension or cash will be
imposed by the Annual Allowance. rental income, dividends etc.) and AVC taxed as earned income.
The tax relief will stop once you reach arrangements you may have in place
age 75. Please note you will not outside of the KPS. LIFETIME ALLOWANCE
receive tax relief on your If the value of all your pension
contributions directly if you do not Due to the complexities of these arrangements exceeds the Lifetime
pay income tax. legislative changes we recommend Allowance at the time you take your
that you seek Independent Financial benefits, a tax penalty will be If you think you might be affected by
ANNUAL ALLOWANCE Advice as neither the Company or payable on the excess amount. The the Lifetime Allowance, you should
If, in any tax year, the total payments Trustee can provide this. Or visit Lifetime Allowance from 6 April 2019 speak to a financial adviser as soon
into all your pension arrangements www.gov.uk/tax-on-pension. is £1,055,000m. as possible.
exceed the Annual Allowance, an
22April 2019
Legal information
DIVORCE/DISSOLUTION OF CIVIL The assets of the KPS are kept investment managers and other The Trustee is registered as a data
PARTNERSHIP separate from those of the Company advisers as appropriate. controller and complies with the
In such cases, the Court may take in order to provide security for the requirements of the Data Protection
pension rights and benefits into benefits of the KPS members and AMENDMENT OR DISCONTINUANCE Act, which allows you to check that
account and may order part of your their dependants. Although the Company intends to personal details held are correct
benefits to be paid to your ex-spouse continue the KPS indefinitely, future (there may be a fee to do this.) Your
or ex-civil partner. We will provide The KPS publishes a Report conditions cannot be foreseen. personal data is kept secure and only
the Court with the information that and Financial Statements on an used for purposes relating to the
they require, and we may charge for annual basis. This is available It reserves the right, therefore, to KPS. Information may be disclosed
this service. from the Scheme’s website amend or discontinue the KPS at any for those purposes to the Company,
(www.kingfisherpensions.com). time in the future. In the unlikely the Trustee’s advisers, the
ASSIGNMENT OF YOUR BENEFITS event of the KPS being discontinued, administrators of the KPS or
You may not sell or assign your KPS You will also receive an annual the Trustee would use your pension insurance companies. It is important
benefits nor may you use them as benefit statement which will show savings to provide benefits for you that you tell the Trustee of any
security for a mortgage or loan. what contributions have been paid and your dependants, in accordance changes in your personal details to
into your pension savings, your with the provisions of the Rules. ensure the information held is
HOW THE KPS IS MANAGED investment return and an estimated accurate.
The KPS has been set up as a trust forecast of the potential pension you DATA PROTECTION ACT 1998
and the Trustee is responsible for might receive when you retire (based Information about present and CHANGES TO THIS MEMBER GUIDE
making sure the KPS is run according on today’s money). former members of the KPS is held This member guide is based on
to the Rules. The Trustee is Kingfisher by the Company and the Trustee for current understanding of legislation,
Pension Trustee Ltd (KPTL). As the ADVISERS the purposes of administration. which may change in the future. The
Trustee is a company there must be The Trustee employs the services of member guide may be amended
directors, and the directors of KPTL solicitors, bankers, auditors, from time to time to reflect changes
form the Trustee Board. in legislation or the Rules of the KPS.
23April 2019
Help and advice
COMPLAINTS OTHER SOURCES OF HELP The Pensions Ombudsman may professional advisers have failed in
The Trustee aims to run the KPS in Pension Wise is a free and impartial investigate and determine any their duties and in certain other
line with best practice, but there may Government service that helps you complaint or dispute of fact or law in circumstances.
be times when you are unhappy understand your new flexible pension relation to an occupational pension
about something concerning your options. This pension guidance may scheme made or referred to him. You can contact TPR at:
benefits or the KPS in general. Most be accessed online, by phone, or face However, the Pensions Ombudsman Napier House, Trafalgar Place,
queries can be sorted out informally to face. For further information please normally insists the matter is first Brighton BN1 4DW
by Legal & General who can be visit www.pensionwise.gov.uk. dealt with through the KPS Internal www.thepensionsregulator.gov.uk
contacted at the address at the back Dispute Resolution Procedure (where
of this member guide. The Pensions Advisory Service (TPAS) available) and that you have made Hargreaves Lansdown is the
is an independent voluntary service use of the Pensions Ombudsman’s independent firm currently appointed
However, if your complaint is not that provides free help and advice to Early Resolution services. by the Trustee to help you find the
resolved to your satisfaction, you members and other beneficiaries of most competitive quote for buying an
may wish to consider making a occupational and personal pension The Pensions Ombudsman can be Annuity on the open market.
formal complaint through the Internal schemes. TPAS is available at any contacted at:
Dispute Resolution Procedure (IDRP). time to assist members and other 10 South Colonnade, Canary Wharf You can contact Hargreaves
Should you wish to make a beneficiaries of the KPS in connection E14 4PU Lansdown’s Retirement Service
complaint, you should write to the with any pensions query they may Telephone: 0800 917 4487 Helpline on:
Kingfisher Group Pensions have or any difficulty they have failed email: enquiries@pensions- Telephone: 0117 314 1798
Department and request an IDRP to resolve with the Trustee or ombudsman.org.uk www.hl.co.uk
Stage 1 Application Form. You should administrators of the KPS.
then outline your complaint on the Early Resolution services at the INDEPENDENT FINANCIAL ADVICE
form provided and return it to the TPAS can be contacted at: address and phone number above You can search for a local
Kingfisher Group Pensions 11 Belgrave Road, London SW1V 1RB helpline@pensions-ombudsman.org.uk independent financial adviser (or IFA)
Department. Telephone: 03001231047 on the unbiased website. This
www.pensionsadvisoryservice.org.uk The Pensions Regulator (TPR) is the website is run by an organisation that
body which oversees the running of promotes independent financial
pension schemes. TPR can intervene advice for consumers – log on to
where the trustees, employers or www.unbiased.co.uk.
24April 2019
PENSIONS TRACING SERVICE The information is clearly explained
The Trustee has given information and sets out the options for
about the KPS, including details of an retirement funding, along with an
address at which it can be contacted, impartial overview of all pension
to the Pension Tracing Service. This arrangements in existence, the
service is run by the Department for benefits and suitability of each.
Work and Pensions and may be of
help to you if you need to contact the TAX CREDIT HELPLINE
trustees of a previous employer’s For more information about whether
pension scheme and cannot trace SMART Pensions will affect your tax
them yourself. credits, please call 0800 731 0175.
The service may be contacted at: STATE PENSION ADVICE HELPLINE
The Pension Service 9 Mail Handling If you would like to find out more
Site A Wolverhampton, WV98 1LU about the Basic State Pension or the
Telephone: 0800 731 0193 State Second Pension, visit the ‘State
www.gov.uk/find-pension-contact- Pensions’ pages at www.gov.uk/
details check-state-pension
DEPARTMENT FOR WORK AND If you wish to find out how much
PENSIONS pension you will receive, you can
The Department for Work and obtain an online State Pension
Pensions (DWP) provides electronic forecast at the above site.
versions of all DWP leaflets, Alternatively, you can request a
brochures, and forms via its website forecast by calling 0345 3000 168.
at www.dwp.gov.uk.
25April 2019
Definitions
ACTIVE MEMBER However, if you choose to take a BASIC PAY normal or similar employment and
A member of the KPS who is still flexible payment of pension benefits Basic pay includes the contractual which seriously impairs your future
employed by the Company and is from the Scheme or any other pension amount that is paid every month but earning capacity.
paying contributions. arrangement, then your Annual also includes certain allowances.
Allowance will reduce to £4,000. Further guidance can be found at KPS
ADDITIONAL VOLUNTARY www.legalandgeneral.com/kingfisher. Kingfisher Pension Scheme.
CONTRIBUTIONS (AVCS) ANNUITY
Additional Voluntary Contributions A contract with an insurance company BENEFICIARY FORM LIFETIME ALLOWANCE
can be paid either as a lump sum or designed to provide you with regular The form on which you tell the Trustee Tax advantages are allowed on
as a set monetary amount each payments in return for an initial lump who you would like to receive the pension and death benefits within
month to provide additional benefits sum payment. Part, or all, of your lump sum death benefits if you die. limits set by the Government each
when you retire. pension savings is used as this initial year. The Lifetime Allowance applies
lump sum payment and in return the COMPANY to all the benefits you build up over
ANNUAL ALLOWANCE Annuity will provide you with a A company within the Kingfisher your entire life – from every pension
The yearly limit set by the Government pension. group that is a participating employer scheme you join. It will be £1,055,000
on the amount that you and the in the KPS. from 2018/19 for the tax year 2018/19
Company can pay towards your AUTOMATIC ENROLMENT onwards. If the value of your benefits
pension before you have to pay tax. Automatic Enrolment is pension DEFERRED MEMBER is over this amount, the excess will
For the 2018/19 tax year the standard legislation which states that from A member of the KPS who has either be subject to an additional tax
Annual Allowance is £40,000. October 2012, phased over a period of 5 opted out or has left the Company. charge. This limit also applies to any
years, eligible employees will be benefits that are payable tax-free on
Please note, if your total earnings automatically enrolled into their INCAPACITY death in service.
plus pension contributions exceeds employer’s workplace pension scheme. Ill health or disability which in the
£150,000 your Annual Allowance will Further guidance can be found at Trustee’s opinion, permanently NORMAL RETIREMENT AGE
be tapered down. www.legalandgeneral.com/kingfisher. prevents you from following your Your Scheme’s Normal Retirement
Age is age 65.
26April 2019
NON-SMART PENSIONS SELECTED RETIREMENT AGE/DATE
Your contributions will be deducted Your Selected Retirement Date is
from your gross basic pay and if important if you have chosen a
you’re a tax payer you will receive tax Lifestyle investment option. It will be
relief on your contributions. Further assumed to be your anticipated State
guidance can be found in the SMART Pension Age. If you are aged above
Pensions Guide. your State Pension Age we will assume
your Selected Retirement Date as one
PENSION COMMENCEMENT LUMP year from your next birthday.
SUM
A lump sum paid from your pension However, you can choose and change
savings when you retire. Under your own Selected Retirement Age at
current legislation this can be up to any time, if you wish.
25% of your pension savings, and is
not subject to tax. SMART
Save Money and Reduce Tax
SALARY (SMART). Further guidance can be
This is contractual pay and does not found in the SMART Pensions Guide.
include commission, overtime,
allowances received and bonuses. STATE PENSION AGE
Further guidance can be found at The age at which you can receive the
www.legalandgeneral.com/kingfisher. State pension.
27April 2019 Who to contact If you have a general question about the KPS or you want to access information about yourpension savings and your investments, please contact Legal & General who run the KPS on a daily basis: Telephone: 0345 026 4179 Monday – Friday 8.30am – 7.00pm Saturday – 9.00am – 12.00pm midday Call charges will vary. Calls may be monitored and recorded. Or email Legal & General at: employerdedicatedteam@landg.com The website for the Kingfisher Pension Scheme is: www.kingfisherpensions.com www.legalandgeneral.com/kingfisher Q0056089
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