How much will you get?
In this section
The firefighters’ pension scheme 2006 is a final salary pension scheme.
Are you building up benefits elsewhere?
This section gives you details about your firefighters' pension scheme 2006 pension. If you also have benefits in the firefighters' pension scheme 2015, you should read how much you could also receive from that section.
How much will you get?
Understanding the numbers
The firefighters’ pension scheme 2006 is a final salary pension scheme, which means the amount you get in retirement is based on:
- how long you were a member;
- your final pensionable pay when you leave; and
- an accrual rate (1/60).
Annual benefit statement
Review your figures
Each year we will let you know the value of your pension in your annual benefit statement, or for those members affected by age discrimination remedy, your annual benefit statement and remediable service statement (ABS RSS).
Find out more about your ABS RSS.
Calculating your pension
How it works
Your pension is calculated using the following formula:
Your pension is calculated using the following formula:
Annual pension =
Pensionable
service
Final
pensionable pay
1/60
(accrual rate)
Example
Calculating your pension
Retirement age: 60
Pensionable service: 20 years
Final pensionable pay: £30,000
20 x £30,000 x 1/60 = £10,000 a year
Retained firefighters
Pensionable service
Because retained firefighters do not work a fixed number of hours, pensionable service is worked out based on pay.
The actual pensionable pay received is compared with the pay that would have been received over the same period by a whole-time regular firefighter in the same role and with similar service (the reference pay). The comparison is usually done for scheme year (1 April to 31 March) during the firefighter's membership and this gives the pensionable service which will count in each year.
Example
Pensionable service for retained firefighters
Suppose a retained firefighter worked for three scheme years – from 1 April 2012 to 31 March 2015. Assume the pay of a whole-time regular firefighter in a similar role over the same three-year period was:
1 April 2012 to 30 June 2012 = £24,000
1 July 2012 to 30 June 2013 = £26,000
1 July 2013 to 30 June 2014 = £28,000
1 July 2014 to 30 June 2015 = £30,000
These rates of pay would be the starting point for working out the retained firefighter's pensionable service.
Next we need to break down these rates of pay to show how much would actually have been received by the whole-time regular firefighter within each of the scheme years.
Year 1:
1 April 2012 to 30 June 2012: 91/365 x £24,000 = £5,983.56
1 July 2012 to 31 March 2013: 274/365 x £26,000 = £19,517.81
£25,501.37
Year 2:
1 April 2013 to 30 June 2013: 91/365 x £26,000 = £6,482.19
1 July 2013 to 31 March 2014: 274/365 x £28,000 = £21,019.18
£27,501.37
Year 3:
1 April 2014 to 30 June 2014: 91/365 x £28,000 = £6,980.82
1 July 2014 to 31 March 2015: 274/365 x £30,000 = £22,520.55
£29,501.37
Then the pensionable pay received by the retained firefighter has to be established. For this example, let's suppose pay records show that the pensionable pay received by the retained firefighter was:
Year 1: £6,429.12
Year 2: £4,132.56
Year 3: £8,528.21
To work out the service credit for each year, we divide the pensionable pay received by the retained firefighter by the pensionable pay received by the whole-time regular firefighter:
Year 1: £6,429.12/£25,501.37 = 0.2521 of a year
Year 2: £4,132.56/£27,501.37 = 0.1503 of a year
Year 3: £8,528.21/£29,501.37 = 0.2891 of a year
Total: 0.6915 years' pensionable service
The pensionable service used in the pension calculation is 0.6915 years (approximately 252 days).
Lump sum
Balancing pension and lump sum
You can give up part of your pension for a tax free, cash lump sum. This is known as ‘commuting your pension’ or commutation.
Cash lump sum calculations
You can give up as much or as little pension as you like. The scheme rule mean that your lump sum can be no more than the government limits known as the lump sum allowance which is £268,275 for the 2025/26 tax year.
For each £1 of pension that you give up, you get £12 as lump sum.
Example
| Pension only |
Pension and lump sum (if you choose to exchange the full 25% for a lump sum) |
|---|---|
|
Pension each year: £16,000
Cash lump sum at retirement: £0 |
Pension each year: £12,000
Cash lump sum at retirement: £48,000 |
Process:
- 01.
Let your administrator know that you want to give up part of your pension to take a lump sum, no earlier than four months before your retirement and before your first pension payment is made.
- 02.
Choose how much of your pension you would like to give up for a lump sum.
- 03.
Your administrator/fire and rescue authority will arrange for the lump sum payment to be made as soon as possible after your retirement date.
- 04.
Your remaining pension will be paid on the next available payroll. Your administrator should let you know when this will be.
Note: higher tier ill health pensions cannot be exchanged for a lump sum.
Tax
HM Revenue and Customs limit the amount of lump sum you can take before receiving a tax charge. This is known as the lump sum allowance – your administrator will let you know more about this if you are affected and you can also find out more in the tax section.
Small pensions
Trivial commutation
Example
Trivial commutation
Annual pension = £1,200 a year
Value for trivial commutation = £1,200 x 20 = £24,000
In this example the member would be able to look into taking their pension as a lump sum.
If the value of your pension from all your pension arrangements is less than £30,000, you may be able to take it as a lump sum. This is known as trivial commutation.
In the calculations for trivial commutation, to work out the value of your pension in firefighters’ pension scheme 2006, you would multiply the annual pension by 20.