Private sector occupational pension schemes

Also known as company pension plans, these are set up by employers and can provide benefits including a tax-free lump sum (within certain limits), and pension income in retirement.

These benefits will generally be based on;

• your final earnings (final salary defined benefit schemes) or
• your average earnings throughout your career (career average defined benefit schemes) or
• the value of your pension fund at retirement (defined contribution schemes).

Apart from benefits on retirement, pension schemes can provide benefits to dependants on death in service or death after retirement. Pension benefits are also portable and need not be ‘frozen’ when your employment status changes.

You should check and see if your employer has such a scheme and whether you are eligible to join. Or you may have been a member of such a pension scheme in the past and still have benefit entitlements under the scheme.