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I'm in classic, can I get a lump sum at retirement? - classic

You will be able to choose to give up part of your pension for an additional lump sum. You can choose how much extra lump sum you want up to a maximum set by HMRC. You must give up £1 of annual pension for each £12 of additional lump sum you take.

You can find out how much additional lump sum you can take, and the effect it will have on your pension by using the calculator on the Civil Service Pensions website (or you can ask the Scheme Administrator (MyCSP) to do this for you if you do not have access to the calculator).

Reducing your annual pension in this way generally has no impact on your dependants’ pensions as these are based on your pension before you give any up for a higher lump sum.

However, if you are aged 75 or over when you die, the tax rules on pensions may restrict the total of any dependants’ pensions payable to a maximum of the amount of your pension at the date of your death.

If you take a higher lump sum, your dependants’ pensions may reduce if you die after reaching 75 and leave two or more children under age (or under age 23 if they are in full-time education).

If you are single and eligible for a partial or full refund of WPS contributions on full retirement, you will have less scope to give up pension for an additional lump sum. This is because the total of any WPS refund plus any additional lump sum you choose to take cannot exceed the maximum permitted lump sum.

Please note that from 1 April 2012, you will only receive a refund of the 1.5% WPS contributions paid. You will not receive a refund of the additional contributions above 1.5% paid from that date.

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