Members Guide - Sept 2013
Transcript of Members Guide - Sept 2013
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Members GuideFrom September 2013
Further inormation:
www.gmgpensions.co.uk
PERMANENT & FIXED TERM CONTRACT EMPLOYEES
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4. Introduction
5. Joining the Plan
6. Your Contributions
7. Company Contributions
9. Investments
10. Lie Assurance Cover
11. Leaving Employment
12. Taking Retirement Benefts
Securing Pension Benefts
13. Looking Ater Your Money
14. PaySmart
18. Temporary Absence
Previous Pension Benefts
18. State Pensions
Page 19. Flexibility -
Ceasing Membership
Divorce
Data Protection Act
20. Tax Allowances
Complaints Procedure
21. External Agencies
Amendment o the Plan
and Discontinuance
Assigning Your Benefts
Plan Documentation
22. Glossary
27. Contact Details
Ctts
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Itrdcti
GMG Liestyle Plan is our own in-house company
pension scheme which is run rom Guardian
Media Groups pensions department - see back
cover or contact details.
You will have already received an explanatorybrochure about the Liestyle Plan. This guide and
the rest o the Liestyle Plan literature aims to
provide you with essential inormation to help
you get the best rom your membership o the
Company pension plan.
Where necessary, you should obtain your own
independent nancial advice. You should always
bear in mind that membership o the Liestyle Plan
is likely to orm only a part o your overall nancialarrangements and you should always be mindul
o other savings products in the market place.
We have tried to explain the issues as clearly
as possible and have kept the use o technical
expressions to a minimum. Please reer to the
glossary at the back o this guide which we hope
will be o help. The exact terms and conditions
governing the Plan are contained in the Trust
Deed and Rules which are available or inspectionon request to the pensions department. Every
eort has been made to accurately refect the
Trust Deed and Rules in this guide, but i there
are any dierences, the Trust Deed and Rules will
always take precedence.
A key part o your nancial planning is your
pension. Next to a mortgage it is probably the
single biggest investment you will make. As a
member o the Liestyle Plan you have an ideal
opportunity to build up the savings you will need
in retirement.
The earlier you start, the easier it is. As a rule
o thumb, i you envisage retiring on a pension
o hal to two thirds o your salary at retirement
which is generally accepted as a reasonable
retirement income then 15 to 20 per cent o
your earnings all your working lie needs to be
saved by you/your employer.
I you dont get started until
later you will need to save much
more to reach the equivalent
level o income. The
key is to start saving
as early as you can.
Jh Wdma
Pensions Manager
It is imprtatthat ydrstad adta rspsiilityr th chics
availal t ydr th Pla
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Jiig th Pla
Eligibility for the Lifestyle
Plan is governed by your
terms of employment.
You will have received details
of the arrangements for yourenrolment in the Plan when
you received your copy of the
explanatory brochure with
your job offer/contract.
5
Hw th Listyl Pla wrs
You save within an investment und and build a
pot o money (your personal Liestyle account)
that you use to buy an income when you retire.
You can choose to take up to 25% o this
money as a tax-ree lump sum when you retire.
The Company will pay money into your account
on your behal. The more you save, the more the
company pays in.
The income you get when you retire will
depend on the size o your personal
investment pot which in turn depends on
what youve saved, how investments have
perormed and also on the market rate or
buying a pension when you retire.
Yrctritis
Cmpayctritis
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P L u S : L I F e A S S u R A n C e & S T A T e b e n e F I T S o n T o P
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A grat way stig yrpsi rthr
is thrghAdditial
Vltary
Ctritis
6
Yr Ctritis
The Plan is registered with Her Majestys
Revenue and Customs (HMRC). This means that
membership o the Plan gives you the opportunity
to make signicant tax ecient savings towards
your uture and to benet rom substantial
contributions rom the company.
ordiary Ctritis
AsamemberofthePlanyourstandardrateof
contribution is 5% o your pensionable earnings.
Ifyouwish,youcanchoosetopayathalfrate
ie 2.5%. In this case the company will also
contribute at hal rate.
Rememberthatyousavetaxbypaying
contributions which reduces the cost to you *
see examples below. (Visit our website and try
out the easy to use calculator to see how much
tax you can save www.gmgpensions.co.uk ).
Examples o cost or monthly salary o 2000
YouR CHoSen
ConTRIbuTIon RATe5% 2.5%
Cst r tax savigs 100 50
Lss tax savd* 32 16
Actal cst t y 68 34
* Most members (except very low earners) will pay less National Insurance
contributions, as well as paying less income tax, by participating in
PaySmart. PaySmartis a way or you to make contributions to the
Liestyle Plan. Details oPaySmartare given on page 14 and on our
website www.gmgpensions.co.uk. The example above is based on
Income Tax and National Insurance rates or the 2013/2014 tax year.
Additial Vltary Ctritis
You can contribute up to 10% o your pensionable
earnings, and up to 15% o non pensionable
earnings, which also attract tax relie, thus
reducing the cost to you. A very attractive
advantage o the Liestyle Plan is that the
company will also help you by paying 50% on top
o whatever you contribute in AVCs.
You can pay a lump sum AVC each February
based on any taxable benets in kind you
receive. Ask the Pensions Department or more
details i you are interested in this.
You can also pay Extra Contributions (ECs) on top
o AVCs and standard contributions. ECs attracttax relie, but do not attract a company top up.
The maximum ECs you can pay will depend upon
your taxable earnings and payroll deductions,
such as National Insurance contributions,
healthcare premiums etc.
To start paying or increase ordinary contributions,
AVCs or ECs, just ask the Pensions Department or
a Contributions Form, or download one rom the
library on our website www.gmgpensions.co.uk .
There may be other ways o increasing your
pension benets which suit you and your personal
circumstances better than paying ECs through the
Liestyle Plan. Beore investing in any nancial
product you should take independent nancial advice.
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Th Cmpayis cmmittdt wrig i
partrship with
mplys t
hlp thm plaad prvid r
a cmrtal
rtirmt
7
It is possible to become a non contributing
member o the Liestyle Plan. In this case, you
would not pay any contributions but the company
would make a xed contribution o 2.5% o pay.
This category o membership is designed to help
employees make a start with their pension savings
when they cannot aord to pay themselves,
although it must be stressed that a contribution
o 2.5% alone cannot realistically be expected to
provide a sucient income in retirement.
The Government sets an annual allowance or tax
relie on pension contributions. See page 20 or
more details.
Cmpay Ctritis
I you pay the standard (5%) rate, the companys
contributions will depend on your age
AGe % oF PenSIonAbLe
eARnInGS
udr 45 8
45 49 9
50 54 10
55 59 11
60 pls 12
Th cmpay will als add 50% t ay AVCs
which y chs t ma.
In addition to the above, the company meets
the whole o the cost o lie assurance premiumsas well as paying all o the general administration
costs o running the Plan.
I you choose to pay at hal rate then the
Company will pay hal o the rates shown.
I you choose to become a non-contributing
member then the company will pay a xed rate o
2.5% o pay, irrespective o your age.
Visit our website and use the calculators to seehow you can maximise the contributions you get
rom the company - www.gmgpensions.co.uk
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nts Ctritis
Intheeventofunpaidtemporaryabsence
you will remain a member o the Liestyle Plan
although no contributions will be payable.
ContributionstotheLifestylePlaninrespect
o Maternity Pay, Paternity Pay or AdoptionLeave are calculated on the basis required by
legislation.
Forperiodsofunpaidmaternity,paternity,or
adoption leave, once you return to work the
Company will pay a lump sum contribution o
2.5% o your notional earnings (or the period o
unpaid leave) into your Liestyle account.
Contributionsareonlypayableinrespectof
Pensionable Earnings actually paid to you whilst
still in employment. Contributions are paid
over to the Liestyle Plan by the company and
credited to your Liestyle account normally on
the last business day o each month.
Inanyindividualcaseitmaybenecessaryto
suspend or reduce contributions to the Liestyle
Plan so that benets arising under the Plan do not
exceed the Lietime Allowance (see glossary).
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Ivstmts
Please reer to our separate Investment
Guide and website or detailed inormation
regarding your investment choices. Briefy, your
contributions, together with the companys
contributions and anything you transer in,
will all be allocated to your individual Liestyle
account. You will receive a benet statement
each year showing details o your individual
account. The statement will show the value o
the contributions you and the company have
made during the year and will also give details
o the way your account is invested.
Chic Fds
You have a choice over how to invest your
own Liestyle account. You can spread your
investment amongst the available unds
in whatever way you choose. It is always
important to keep an eye on your Liestyle
account and you may wish to move between
the available unds rom time to time.
You are able to speciy investment in any o
the ollowing unds in any proportions:-
The Long Term Fund
The Short Term Fund (Bonds Section)
The Short Term Fund (Cash Section)
UK Equity Fund
Overseas Equity Fund
Ethical Global Equity Fund
Corporate Bond Fund
UK Government Stocks Fund
Index-Linked UK Government Stocks Fund
Atmatic Ivstmt Stratgy
I you dont eel comortable managingyour own investments, there is an automatic
arrangement. Under this arrangement, your
account is normally invested in the Long Term
Fund, which is currently invested in a mixture
o Equities and Bonds. The value o these
investments can be volatile rom time to time
and can sometimes suer sharp setbacks in
times o economic or political diculty. Despite
this volatility and the absence o guarantees,these types o investments are nevertheless
generally considered to provide an appropriate
vehicle or long term growth.
As you approach retirement, it is usually helpul
to try to reduce volatility by switching your
Liestyle Account into the Short Term Fund
which is currently invested in Bonds and Cash.
Whilst Bonds can fuctuate, they tend to move
in line with interest rates generally thus giving
some stability to the pension which you can
purchase with your accumulated account.
However, Bonds cannot protect against
changes in other actors which insurance
companies use to determine annuity rates
such as mortality trends. You should also bear
in mind that the Short Term Fund might not
be appropriate i you intend to choose a non-
conventional annuity or income draw down
arrangement (see the Liestyle Plan literature
or more inormation regarding these choices
at retirement).
Under the deault arrangements, your
investments are normally automatically
switched over the ten years beore your
retirement rom the Long Term Fund into the
Short Term Fund. In each o the ten years until
retirement 10% o your accumulated account
will be switched, so that during the last year
beore retirement, the whole o your account
will be in the Short Term Fund. Your retirementdate or this purpose is set to the deault (age
65) although you can speciy your own Target
Retirement Date thus giving you control over
the switching into the Short Term Fund. You
can change your Target Retirement Date at
any time.
The deault strategy has been designed to
provide a careully worked out investment
strategy that can be suitable or many
members through their careers. However,
there could be a number o reasons why
you might want to override the automatic
arrangements and make your own investment
choices, perhaps ater seeking independent
nancial advice.
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Li Assrac Cvr
Ctritry Mmrs
In the event o your death in employment whilst
a contributing member o the Liestyle Plan,
the ollowing lump sum benet would become
payable:-
a) 3 times your Death Benet Salary plus the
part o your account relating to your own
AVCs and ECs.
pls
b) The greater o:-
4timesyourDeathBenetSalary(plusthepart
o your account relating to any transer rom a
previous scheme)
r
thevalueofyourLifestyleaccountexcluding
the part relating to your own AVCs and ECs
The lump sum would be payable under trust and is
currently tax ree provided it is below the Lietime
Allowance - see Glossary.
n Ctritry Mmrs
In the event o your death in employment whilst a
non contributing member o the Liestyle Plan, the
ollowing benets would become payable:-
A lump sum o 3 times your Death Benet Salaryplus a urther lump sum equal to the value o your
Liestyle account. The lump sum would be payable
under trust and is currently tax ree provided it is
below the Lietime Allowance - see Glossary.
nts Dath i emplymt bfts
The trustees have eected insurance cover in
respect o the liabilities or death benets to the
extent that they exceed the values o members
Liestyle accounts. In some cases it may benecessary to restrict the amount o lie assurance
cover where the trustees insurance o the benet
has been restricted by the insurers.
Special conditions will apply to the death benets
i you re-enter the Liestyle Plan ater ceasing
active membership or join at a date later than
when rst eligible.
All benets payable on death in employment
are subject to HMRC limits and may need to
be restricted to ensure they do not exceed the
prevailing limits.
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Lavig emplymt
Fr vry jiig th Pla , r atr,
1st Sptmr 2013, trmiati
mplymt th llwig ptis ar
availal:
(a) All o the money paid into your Liestyleaccount can remain invested until you retire, when
it can be used to buy a pension in the normal way.
This includes your contributions and all o the
money paid by the company. You can still choose
rom the ull range o investment options.
() At any time you can choose to transer your
ull account to another pension arrangement.
Fr ay wh jid th Pla prir t 1stSptmr 2013, ad wh lavs r
cmpltig tw yars qaliyig srvic,
y ca ithr:
(a) Take a reund o the value o your
contributions (any reund is subject to tax)
r
() Within six months o leaving, you can transer
out the ull value o your account to anotherpension arrangement.
Paymt lmp sm Dath bfts
Lump sum benets arising on death are paid
under trust. This means that the trustees have
to decide who is to receive the benet. The
purpose o this arrangement is to ensure that the
payment is ree rom inheritance tax under current
legislation and that it can be paid quickly without
needing to wait or probate etc.
Although the trustees have the nal decision
as to who should receive any death benet you
are encouraged to complete a nomination
orm to indicate your wishes regarding possible
Beneciaries.
You should keep this orm up to date i yourcircumstances change.
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Taig Rtirmt bfts
The table below shows when Liestyle Plan benets can be taken.
nrmal Rtirmt Ag
The Plans Normal Retirement
Age is 65, however your own
Target Retirement Date
(TRD) is more important.
TRD controls the timing
o the switching o your
Liestyle account rom
the Long Term und in to
the Short Term Fund. You
can set your TRD to suitwhen you think you will
take your retirement
benets.
Scrig Psi bfts
Your pension is normally secured by the trustees
by the purchase o an annuity with an insurance
company. (Other options are available, via your
adviser, and are brought to the attention o
members in the brochure Your Pension - Your
Choice).
The Liestyle Plans advisers are responsible or
advising the trustees on the choice o insurance
companies or the purchase o each members
benets. Quotations are always obtained or each
members benets at the time o retirement rom
the panel o insurance companies as notied by
the advisers. However, you can i you wish speciy
any insurance company to be used or the purpose
o securing your benets.
I you joined theLiestyle Plan beore6th April 2006
I you joined theLiestyle Plan on or ater6th April 2006
TAke beneFITS AnD SToP
WoRkInG AT GMG
TAke beneFITS AnD CARRY on
WoRkInG AT GMG
Ys, rm ag 50 Ys, t ly rm ag 55
Ys, t ly rm ag 55 Ys, t ly rm ag 55
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All o your account can be used to secure pension,
and you will be able to choose the level o any
built-in increases and the level o built-in spouses
pension.
You may elect to take a tax ree lump sum o anyamount up to the maximum laid down in the Trust
Deed and Rules which refects the requirements
o Her Majestys Revenue & Customs (HMRC).
This is typically 25% o your individual account at
retirement.
Details o the choices available to you at
retirement can be requested rom the Pension
Department at any time.
Lig atr yr my
The day to day running o the Liestyle Plan is
dealt with rom the Guardian Media Groups
pensions department - see back cover or contact
details.
The Liestyle Plan has trustees who are ultimately
responsible or the proper running o the Plan.
Some o the trustees are elected by the members.
The trustees have adopted regulations governingthe procedures or election o trustees which they
may review and amend rom time to time.
Audited accounts are prepared every year and are
available or inspection.
Additional inormation is disseminated to
members on a regular basis in the orm o
newsletters (also including a summary o the
audited accounts), statements o account,
illustrations o benets and via our website,
www.gmgpensions.co.uk .
The Liestyle Plans investments are
handled by independent investment
managers appointed by the trustees. The
investment returns are regularly monitored
by independent advisers. The costs o
investment management are deducted
rom the unds. Each year you will be given
details o the investment returns along
with other nancial inormation about theLiestyle Plan. Every week the latest unit
prices are available on our website at
www.gmgpensions.co.uk .
Your money is held in a und that the
Company cannot touch. The value o
your Liestyle account may go up or down
depending on investment returns. Whilst
there are no guarantees about how much
your pension will be when you retire, theCompany cannot access your money once it
is in your Liestyle account.
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Hw ds PaySmart actally wr?
Youagreetogiveuppartofyourcontractualpay
equivalent to the contribution you would have
paid to the Liestyle Plan. Your gross pay reduces.
Atthesametimeyoustoppayingdirect
contributions into the Plan and your net pay
rises by the amount o the National Insurance
contributions you would have paid on your Plan
contributions.
TheCompanyincreasesitscontributionsto
the Plan by the amount you would have paid
in so that the total contribution paid into your
personal account in the Plan is unchanged.
YourpaybeforetheadjustmentforPaySmart
will continue to be used or the calculation othe benets provided by the Plan and all other
contractual benets provided by the Company
(but not State benets). Your pay will be
reviewed annually in the normal way.
Hw mch natial Israc will y sav
thrgh PaySmart?
The National Insurance savings you can make
depend on how much you earn and the level o your
contributions to the Liestyle Plan. E.g. or the taxyear 2013/14 the National Insurance rates were:
12% on annual earnings between 7,755 and
41,450
2% on annual earnings over 41,450.
The table below shows examples o the annual
National Insurance savings based on dierent
contribution rates and a range o salaries.
Pensionable
Earnings
National
InsuranceSaving Member
paying 2.5%
Contributions
National
InsuranceSaving Member
paying 5%
Contributions
National
Insurance SavingMember paying
5% Contributions
and 10% AVCs
20,000 60.00 120.00 360.00
30,000 90.00 180.00 540.00
50,000 25.00 50.00 150.00
Figures are or illustration purposes only and are based on National
Insurance rates applicable or the tax year 2013/14.
PaySmart - a smartway payig r yrpsi
PaySmart is a more tax efcient
way o making your contributions
to the Liestyle Plan, which saves
both you and the Company
money. A major advantage o
paying contributions into pension
schemes, such as the Liestyle
Plan, is that you pay less income
tax. By paying your contributions
via PaySmart, you also pay less
National Insurance contributions.
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erllig i PaySmart
The Company will automatically enrol you
in PaySmartas soon as you join the Liestyle
Plan, unless you conrm beorehand that
you dont want to be included. However,
you wont be enrolled in PaySmarti you
earn less than a certain level o pay (7,800a year or 2013/2014), since some o your
State benets could be adversely aected.
The minimum pay level or inclusion in
PaySmartis reviewed each year.
Why d w prat PaySmart?
The cost o providing a pension has risen
signicantly in recent years. PaySmart is a
way or both members o the Liestyle Plan
and the Company to make savings in away that is acceptable to HM Revenue &
Customs. Your savings increase your take-
home pay, or you can use these savings
to increase your pension contributions.
The Company uses its saving on National
Insurance to help meet a small proportion o
its signicant contributions to the Plan.
D thr cmpais prat similar
arragmts?Yes, including many large employers like
Tesco, Sainsburys, BT and Orange.
Am I ligil r PaySmart?
Most Plan members are automatically
eligible or PaySmart. However, PaySmart
may have a negative impact on the
entitlement to some State benets or
members who earn less than a certain level
o pay (7,800 or 2013/2014). For thisreason, they are not automatically eligible or
PaySmart, although they may participate at
their request, having weighed up all the pros
and cons.
Any members whose pay would be reduced
below the National Minimum Wage as a
result o PaySmartare also excluded in order
to comply with this requirement.
What i I dt wat t pay myctritis via PaySmart?
You can choose not to participate in
PaySmartat anytime by completing a Non-
participation in PaySmart orm available on
the pensions website.
PaySmart ad AVCs
I I pay Additial Vltary
Ctritis (AVCs) r extra
Ctritis (eCs), will ths
icldd i PaySmart?
Yes, unless you choose not to participate
in PaySmart, all contributions that you paywill be made via PaySmart. Remember that
the more contributions you pay through
PaySmart, the less you pay in National
Insurance.
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PaySmart ad yr payad fts
Will my thr pay-rlatd fts
asd my rdcd pay, atr
ctritig thrgh PaySmart, r my
rigial ctractal pay?
None o the earnings-related benets you
receive as part o your Company benets
package will be aected. And your contractual
pay beore PaySmartwill continue to be used to
calculate any bonuses or pay increases.
Hw ds PaySmart act my thr
Cmpay fts?
PaySmartis part o your contractual terms and
conditions because your gross pay is reduced
and an additional pension payment is made
by the Company instead. Its your contractual
pay beore the PaySmartreduction that is used
to determine any other pay and pay-related
benets your lie assurance cover, sick pay,
shit pay and severance terms etc. So there will
be no reduction in your Company benets or
other pay as a result o being in PaySmart.
As my ctractal pay is rdcd dr
PaySmart, will this act th amt
mrtgag r la I cld rciv?
No. As now, reerence letters provided by the
Company or mortgage or loan purposes
will reer to your contractual pay beore any
adjustment or PaySmart.
PaySmart ad Stat fts
Hw ds PaySmart act my Stat
psi fts?
Your Basic State Pension will not be aected
i you make PaySmartcontributions.
As well as the Basic State Pension, theState currently provides an earnings-
related pension (known as the State
Second Pension, or S2P). I you earn
between 15,000 and 40,040 a year
(2013/14 tax year), PaySmartwill result in
a small reduction in the amount o your
S2P entitlement. Typically, however, this
reduction will be more than oset by the
saving you make in National Insurance
Contributions.
Is PaySmart sital r vrydy?
The Company does not possess enough
detailed inormation about your personal
circumstances to conrm denitively
whether you may be adversely aected.
Thereore, you should consider your own
circumstances based on the inormation
in this guide. This will be o particular
relevance to you i you are in receipt o Child
Tax Credits or Working Tax Credits. It may
also aect the calculation o any statutory
maternity, paternity or adoption pay.
Will th CSA paymts I ma
actd?
Possibly. CSA payments are calculated
using your weekly net income (gross weekly
income less income tax, National Insurance
and pension contributions). Participating
in PaySmartresults in an increase in yournet pay. I your net weekly pay increases,
it could be that CSA payments would also
increase. However, the CSA only need to be
advised i your net weekly income changes
by 5% or more.
What at stattry pay r
matrity lav?
Statutory maternity pay (SMP) will be
based on your pay ater any reduction dueto PaySmart. This means that SMP would
reduce slightly or someone participating in
PaySmart. I you think you may be in receipt
o SMP in the near uture then you should
consider whether to continue participating
in PaySmart.
Ca I chs t t ctrit
via PaySmart?
We believe the vast majority o members willbenet rom PaySmart. But i you dont want
to participate in PaySmartyou dont have to.
To stop paying contributions via PaySmart,
youll need to complete a Non-Participation
in PaySmart orm. But remember, i you
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1717
choose not to participate in PaySmart, you wont
be taking advantage o the National Insurance
savings you could otherwise make.
I I chs t t participat iitially ca I
cm ac it PaySmart?
Yes, you can come back into PaySmartby
completing a Request to participate in PaySmartorm. Please contact the Pensions Department i
you wish to do this.
What d I d t d t ft rm
PaySmart?
You dont need to do anything. I you are eligible
to contribute via PaySmart, all your contributions
will automatically be paid via PaySmart.
Ca th Cmpay withdraw PaySmart?PaySmartis a contractual change to your earnings
and contributions to the Plan. However, because
circumstances can change, the Company reserves
the right to withdraw PaySmartand reintroduce
direct employee contributions. Your contractual
earnings would then be increased by the amount
o your Plan contribution to what they would have
been had PaySmartnever existed. The Company
does not accept any liability or responsibility to
provide any orm o compensation or any benets
lost rom ceasing to operate PaySmart.
Cld HM Rv & Cstms a
PaySmart?
At present, the Revenue allows the PaySmart
scheme to operate. However, a change in the law
or in Revenue practice could mean that PaySmart
will need to be withdrawn. I this happens, we
will let you know. Rest assured, though, that thesignicant Company contributions will remain.
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Tmprary Asc
Contractual paid leave is treated normally
or every purpose o the Liestyle Plan. In
the event o temporary absence or other
reasons it may be necessary to restrict the
amount o death in employment benets
where the trustees insurance o the benethas been restricted by the insurers.
Prvis Psi bfts
I you have pension benets with your
previous employers company pension
scheme, or perhaps in a personal pension,
you may wish to transer these in to the
Liestyle Plan. Please contact the pensions
department i you are interested intranserring previous pension benets.
Stat Psis
The State scheme currently consists o two
levels o benet:
The Basic State Pension
The State Second Pension (S2P)
The Basic State Pension is a fat rate old age
pension, paid to everyone who has paid
sucient National Insurance Contributions,
and is unaected by your membership o
the Liestyle Plan.
S2P was introduced in 2002, replacing the
previous second tier o state pension, the
State Earnings Related Pension Scheme
(SERPS). You accrue S2P depending on thelevel o your earnings and the National
Insurance Contributions you pay.
You can request an estimate o your State
Pension online at: www.gov.uk/state-
pension-statement .
Under the current state scheme, members
with relatively low earnings and who
may get small private pension benets
at retirement could potentially receivelower means-tested state benets rom
the Government. It is impossible to know
precisely what state benets will be in uture
and to what extent they will be means-
tested. Thereore, it is extremely dicult
or anyone to advise relatively low paid
members whether or not to contribute to the
Liestyle Plan and build up a relatively small
pension und which might reduce the level
o uture state benets.
Planned Changes A Single Tier State
Pension?
Government proposals, announced in 2013,
(Parliament has to agree to changes
before they become law) are:-
Anewsingle-tierStatepensionof144per
week(intodaysearningsterms)willbe
introducedfrom6April2016.ThiswillapplytonewpensionersreachingStatePension
Ageonorafterthisdate.
Thenewbenetwillreplacethecurrent
BasicStatePension,SecondStatePension
andPensionCredit,resultinginareduction
ofpensionermeans-testing.
Thenumberofqualifyingyearsrequiredto
receivethefullStatepensionentitlementwillincreaseto35years.Thisislongerthanthe
currentrequirementof30yearstoqualify
fortheBasicStatePension,butremains
lowerthanthe44yearsformenand39
yearsforwomenrequiredpriorto2010.
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Flxiility - Casig activmmrship whil stillwrig at GMG
You can do this: For example, you could
transer your accumulated Liestyle account
elsewhere (or wider investment choices)
or, rom age 55 onwards, you could takeretirement benets, whilst still working at
GMG. You will also immediately rejoin the
Plan (ater 28 days notice) and build up
a new liestyle Plan account. Contact the
pension department i you are interested.
Divrc
In the event o your divorce, one o the
options available or dealing with your
benets under the Liestyle Plan is or the
court to make a Pension Sharing order.
The order would speciy an amount to be
deducted rom your Liestyle Account. The
amount could then be transerred into a
pension arrangement nominated by your
ex-spouse.
The Trustees have established scales o
administration charges or dealing with
Pension Sharing court orders. These charges
would be payable by divorcing couples.
Details o the charges are available rom the
pensions department.
Data Prtcti Act
Under the Data Protection Act 1998, the
Trustees and your employer have a legal
obligation and a legitimate interest to
process data relating to you or the purpose
o administering and operating the Plan
and associated benets. This may includepassing on data about you to the Plans
actuary, auditor, administrator and such
other third parties as may be necessary or
the administration and operation o the Plan
and associated benets. The inormation is
kept secure and is only disclosed in limited
circumstances.
By joining the Plan you are agreeing to this
data being held and used in this way. It isimportant that the data held about you is
correct. You should notiy the Trustees (via
the pensions department at the address
shown on the back page) and your employer
(please see HR Department) o any change
to your personal circumstances which may
result in a change to the data held in respect
o you. You should also notiy the Trustees
and your employer i you suspect that there
are inaccuracies in this data.
StatePensionAgewillbereviewedevery
veyearsbasedontheprinciplethatState
pensionshouldbereceivedforaspecic
proportionofanadultslife.
Currentpensionersandeveryonereaching
StatePensionAgebeforetheintroduction
oftheat-ratepensionwillcontinueto
receivetheirStatePensioninlinewith
existingrules.
The state system is already highly complex
and subject to uture changes, particularly
with changes in government. For low
earners, what is currently uncertain is
whether, when you retire, your private
savings could reduce your entitlement to
state benets. What is certain is that any
pension benets you save or personally will
be yours at retirement. Also remember that
i you save or your pension in the Liestyle
Plan you will benet rom signicant
Company contributions.
You can get more inormation on all aspects
o the State Pensions rom the Governmentsocial website: www.gov.uk/state-
pension.
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Tax Allwacs
Ctritis
To qualiy or tax relie, total contributions
(rom both you and the Company
and across all tax-approved pension
arrangements) in any year must be within
the Annual Allowance. For the purposes othe Plan, the year over which you will be
assessed will be each Plan year.
The Annual Allowance is 50,000 or
2013/2014, but reduces to 40,000 or
2014/2015. Any excess contributions over
the Annual Allowance will be taxed at your
ull marginal rate o income tax.
I any individual exceeds the AnnualAllowance (AA) in any tax year, rather than
immediately triggering additional tax, they
can carry orward any unused AA rom
the previous 3 years to oset this years
contributions.
bfts at Rtirmt
There is a limit on the total value o pension
benets that qualiy or tax relie. This
limit is known as the Lietime Allowance
and applies to all o the benets you build
up over your entire working lie across all
pension schemes. The limit is 1.5m until
5th April 2014. From 6th April 2014, the limit
will reduce to 1.25m.
I you build up benets above the Lietime
Allowance, they will be subject to tax,although the Government intends to allow
individuals to protect their rights where they
have already built-up large benets prior to
5th April 2014.
Few members are likely to build up a und
value even approaching the Lietime
Allowance. However, i you think you may
be aected by this limit please contact the
Pension Department or an estimate o thevalue o your Liestyle Plan benets.
Cmplaits Prcdr
The Trustees o the Liestyle Plan have
established procedures or dealing
with disputes in accordance with the
requirements o the Pensions Act 1995.
In the rst instance it is hoped that all
questions and complaints will be dealt with
successully on an inormal basis either by
the pensions department or in some cases
by individual trustees. However, i you are
dissatised with the response to a question
or complaint and wish to bring a ormal
complaint you will need to ollow the ormal
procedures.
I you wish to make a ormal complaint you
should contact the pensions department orMembers Notes on the Internal Disputes
Resolution Procedure and a orm to use in
making the complaint.
The rst stage o the procedure is initiated
by either yoursel, or someone nominated to
act on your behal, making a complaint to
J. Woodman, Pensions Manager, Guardian
Media Group plc (address on back cover).
On receiving your complaint the pensionsmanager will respond to it within two
months.
I you are dissatised with the reply you
receive you may reer the case to the
trustees or reconsideration. On receiving
your complaint the Trustees will respond to it
within two months.
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extral Agcis
Th Psis Advisry Srvic (TPAS)
The Pensions Advisory Service (TPAS) is
an independent voluntary service that
provides ree help and advice to members
and other beneciaries o occupational and
personal pension schemes. TPAS is availableat any time to assist members and other
beneciaries o the Plan, in connection with
any pensions query they have or any diculty
they have ailed to resolve with the trustees
or administrators o the Plan. You can contact
TPAS through your local Citizens Advice
Bureau or at 11 Belgrave Road, London,
SW1V 1RB.
Tel: 0845 6012923Website: www.pensionadvisoryservice.org.uk
Th Psis omdsma
The Pensions Ombudsman can investigate
and determine any complaint or dispute
o act or law relating to an occupational
pension scheme made or reerred in
accordance with the Pensions Act 1993. The
Ombudsman may be contacted at
11 Belgrave Road, London, SW1V 1RB.
Tel: 020 7630 2200
Email: [email protected]
Website: www.pensions-ombudsman.org.uk
Hw t trac ld psis
The Trustees have given inormation about
the Plan, including details o an address
at which they can be contacted, to the
Register o Occupational and Personal
Pension Schemes. A tracing service run bythe Registrar may be o help to you i you
need to contact the trustees o a previous
employers pension scheme and cannot
trace them yoursel. The Pensions Tracing
Service can be contacted at Pension Tracing
Service, Tyneview Park, Whitley Road,
Newcastle Upon Tyne, NE98 1BA.
Tel: 0845 6002 537
Th Psis Rglatr (TPR)
TPR is a regulatory body that is responsible
or overseeing the running o occupational
pension schemes and is able to intervene
where trustees, employers or proessional
advisers have ailed in their duties. TPR may
be contacted at Napier House, Traalgar Place,
Brighton, East Sussex, BN1 4DW.
Tel: 0845 600 0707Email: [email protected]
Website: www.thepensionsregulator.gov.uk
Amdmt thPla ad Disctiac
The Trust Deed and Rules contains
provisions or the amendment o the Plan
and also or the termination o the Plan
or the termination o participation in the
Plan o any employer. In the event o anyemployer ceasing to contribute to the Plan
any relevant members accounts would be
used to secure benets or or in respect o
each relevant member. In such a case you
would receive the appropriate amount o
notice.
Assigig yr fts
You are not allowed to assign your benets
under the Plan or use them as security or
a loan.
Pla Dcmtati
Any Plan member may request to see the
Trust Deed and Rules and the latest annual
report and accounts.
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Glssary
This glossary aims to provide a relatively
straightorward explanation o some o the
technical expressions used in this Members Guide.
The exact interpretation o words used is always
subject to the denitions used in the Trust Deed
and Rules o the Liestyle Plan.
Additial Vltary Ctritis
In addition to Ordinary Contributions o 5% o
your pay, you can also pay Additional Voluntary
Contributions (or AVCs). You can contribute up
to 10% o pay as AVCs.
For every 1 you pay as AVCs, the Company
pays 50p more into the Liestyle Plan. So, i you
contribute AVCs o 10% o your pay, the Companywill contribute a urther 5% o your pay.
Aal Allwac
The total contributions in respect o an individual
(employee and company) paid into the Liestyle
Plan, plus any other pension arrangement, that
are eligible or tax relie. The Annual Allowance is
50,000 or 2013/2014, but reduces to 40,000
rom 6th Apr il 2014.
Aity
An annuity is the pension purchased at retirement
using your Liestyle Account (ater taking any tax-
ree cash). An annuity is payable or your lietime
and can continue at a lower level to your spouse in
the event o your death ater retirement.
bfciary
This means one or more persons or bodies as the
trustees consider would be appropriate recipients
o all or part o the lump sum benets payable on
a Members death.
Civil Partr
A partner o the same sex with whom you haveentered into a legally recognised relationship (i.e. a
civil partnership). Civil Partnerships rst started in
the UK on 5th December 2005.
Crprat bds
These are similar to government bonds, but they
are issued by non government agencies and
companies. Interest is paid at a xed rate over
the term o the bond and the capital is repaid at
the end o the term. Corporate bonds are rated byindependent organisations according to their ability
to be able to pay the interest payments and the
capital at the end o the term. Investment grade
bonds are those rated AAA, AA, A and BBB, with
the highest rating AAA, ollowed by AA, A and BBB.
Corporate bonds rated below this are known as sub
investment grade, high yield or junk bonds.
The Liestyle Plan unds only invest in investment
grade bonds rated AAA, AA and A. See theInvestment Guide or urther details.
Dath bft Salary
This means the highest total o any consecutive
12 months Pensionable Earnings in the 48 months
prior to date o death.
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Dfd Ctriti Psi Schm
See Money Purchase Pension Scheme on page 25.
eqitis
Ordinary shares in companies ie stock market
investments. In the context o the Liestyle
Plan we usually mean investment in a pooled
und which comprises shares in a wide rangeo companies rather than shares in just one
company. UK equities reers to pooled unds
investing in companies quoted on the London
Stock Exchange although most o these
companies do have trading operations all over the
world. Similarly each o the overseas regions (eg
Europe, North America, etc) reers to the stock
market grouping or the particular pooled und.
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extra Ctritis
I you are already contributing Ordinary
Contributions o 5% o your pay and Additional
Voluntary Contributions o 10% o your pay, you
can still save even more into the Liestyle Plan. Such
urther savings would be Extra Contributions (ECs).
Whilst the Company does not pay any morecontributions in respect o your ECs, you would still
get tax relie on them.
Gvrmt Stcs
Sometimes called Gilts. These are securities issued
by the UK government and thereore the interest
payments and the capital repaid at the end o
the term are guaranteed and can be regarded as
absolutely secure.
Listyl Acct
We allocate all your contributions and the
Companys contributions or you into your Liestyle
account which is then invested. Your Liestyle
account is thereore part o the overall unds o the
Liestyle Plan, but we keep track o the contributions
and changes in value or each member separately.
Lg Trm Fd
This is part o the Liestyle Plans unds. It is our ownin-house description or the und which is designed
to meet the needs o a typical member during the
majority o his or her career. It will be invested in
the types o investments which suit this objective.
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2525
Litim Allwac
This is the limit on the amount o an individuals
pension benet (unds) that qualies or tax relie.
It applies when benets are taken and applies
to all pension benets that individuals build up
over their entire working lie accross all pension
schemes.
The lietime allowance is reducing to 1.25m rom
April 2014. (For 2013/2014 it is 1.5m)
My Prchas Psi Schm
The Liestyle Plan is sometimes reerred to as a
Money Purchase pension scheme or a Dened
Contribution pension scheme. This means that
contributions made by you and the company
are invested until you are ready to draw your
benets. The benets at retirement may bepartly in the orm o a lump sum and the balance
o your accumulated account is then normally
used to buy an annuity with an insurance
company. There are a variety o choices available
to you at retirement see Liestyle booklet Your
Pension Your Choice or more inormation.
ordiary Ctritis
In the Liestyle Plan, members have a
choice o how much to pay. They can contribute0%, 2.5% or 5% o pay as Ordinary Contributions.
The more a member pays, the higher the
Companys contributions into the Liestyle Plan.
Further contributions can be made, in the orm
o Additional Voluntary Contributions and Extra
Contributions.
PaySmart
A eature o the Liestyle Plan that enables you to
pay your ordinary contributions, AVCs and ECs in
a more tax ecient manner, meaning both you
and the company pay less National Insurance
contributions, in addition to you paying less
Income Tax.
Psial earigs
This means actual salary including bonuses or
overtime. Any such item may be excluded i
notied by the company beore it is paid.
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26
I y dt lcmrtalmaagig yr
w ivstmts,thr is a
atmatic
arragmt
26
Shrt Trm Fd
This is a part o the Liestyle Plans unds. It is our
own in-house description or the und which is
designed to meet the needs o a typical member
as he or she approaches retirement. It will be
invested in the types o investments which suitthis objective.
Stat Psi Ag
This is the age at which your State Pension is
payable and is specic to your date o birth.
You can check your own State Pension Age on the
online calculator at www.gov.uk/calculate-state-
pension
Switchig
In our deault arrangement, investments in your
Liestyle account are automatically moved rom
the Long Term Fund into the Short Term Fund
as you approach retirement to gradually reduce
volatility. For many members this can be a suitable
arrangement and it is thereore a vitally important
eature o the Liestyle Plan. This is now oten
reerred to as liestyle switching and is refected
in the name o our company pension plan!
Targt Rtirmt Dat (TRD)
This is the date you set or yoursel to control the
timing o the switching o your Liestyle account
rom the Long Term Fund into the Short Term
Fund. It does not mean you must retire at TRD. It
is simply the way in which you can have personalcontrol over your Liestyle account in the years
leading up to your expected retirement. You can
change your TRD at any time to refect the best
estimate o when you think you may draw your
benets.
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Ctact DtailsFor urther inormation
about the Liestyle
Plan, please contact the
Pensions Department.
See overlea or details.
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The Pensions DepartmentGuardian Media Group plcCenturion House, 129 Deansgate,Manchester M3 3WR
Tel: + 44 (0)20 3353 2000Fax: + 44 (0)20 3353 3125
Email: [email protected]