Pension schemes: end of contracting-out

How the ending of contracting-out will affect pension entitlements and how to check your members' Guaranteed Minimum Pension (GMP).

The new State Pension has replaced the existing basic and Additional State Pension and ended contracting-out for defined benefit pension schemes.

HM Revenue and Customs (HMRC) won’t track contracted-out rights or issue statements to pension schemes.

What you need to do

If you provided a defined benefit contracted-out scheme you’ll need to:

  • comply with the legislation
  • make sure that members’ entitlements resulting from contracted-out employment are protected
  • provide a GMP to your members for contracted-out service between 6 April 1978 and 5 April 1997 (a GMP is payable at age 60 for a women and 65 for a man)

Further help

You can use the GMP checker to get a calculation for your members.

HMRC will continue to offer support to deal with any queries up until December 2018 under the Scheme Reconciliation Service.

Published 6 April 2016