# Royal Mail Pensions



## Muggers (May 15, 2014)

Can anybody who is in receipt of a Royal Mail Pension in Spain clarify something for me please?
I think I am right in saying that so called Government pensions are taxable only in the Uk (if thats where the pension originates). But what qualifies as a Government pension?
I receive a RM pension, and was wondering if it is now classed as a government pension since the takeover by the UK government of the assets and liabilities of the Royal mail pension fund? To all intents and purposes it has become a pension paid by the government, funded by tax payers and under the control of a government minister. Its accounts are presented to parliament who must vote to fund the scheme.
Perhaps someone in receipt of a RM pension could enlighten me.
Thanks, Muggers


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## Aron (Apr 30, 2013)

Muggers said:


> Can anybody who is in receipt of a Royal Mail Pension in Spain clarify something for me please?
> I think I am right in saying that so called Government pensions are taxable only in the Uk (if thats where the pension originates). But what qualifies as a Government pension?
> I receive a RM pension, and was wondering if it is now classed as a government pension since the takeover by the UK government of the assets and liabilities of the Royal mail pension fund? To all intents and purposes it has become a pension paid by the government, funded by tax payers and under the control of a government minister. Its accounts are presented to parliament who must vote to fund the scheme.
> Perhaps someone in receipt of a RM pension could enlighten me.
> Thanks, Muggers


I have a Royal Mail pension and I pay my taxes on that pension in Spain. Now saying that, if you joined Royal Mail in the 60's you may have a civil service pension, but I started with Royal Mail in 1976 and it is not classed as a government pension that is only taxed in the UK


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## Aron (Apr 30, 2013)

Since the government underwrote the debt in the pension, nothing has changed with respect to my pension and the way it is taxed.


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## Muggers (May 15, 2014)

Thanks Aron.
I was rather wondering in anyone had attempted to to have their RM pension reclassified under the tax regs since its status has changed so dramatically.
I will try to get a definition of government pension to see what it actually means. If you have the inclination you can read the annual accounts here
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/246768/0149.pdf
Just scroll down to the section headed "Report" and you will see that the Gov took on more than just the debt.


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## Aron (Apr 30, 2013)

Muggers said:


> Thanks Aron.
> I was rather wondering in anyone had attempted to to have their RM pension reclassified under the tax regs since its status has changed so dramatically.
> I will try to get a definition of government pension to see what it actually means. If you have the inclination you can read the annual accounts here
> https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/246768/0149.pdf
> Just scroll down to the section headed "Report" and you will see that the Gov took on more than just the debt.


The easiest way to find out is to phone the helpline at Chesterfield, but nothing has changed with the conditions of my pension. The RM pension scheme get their information from HMRC about my pension and that hasn't changed. 
I used to be involved with the CMA and read every report I had to. When I retired I decided to read no more reports or attend any more meetings as long as I live.


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## Muggers (May 15, 2014)

Aron said:


> The easiest way to find out is to phone the helpline at Chesterfield, but nothing has changed with the conditions of my pension. The RM pension scheme get their information from HMRC about my pension and that hasn't changed.
> I used to be involved with the CMA and read every report I had to. When I retired I decided to read no more reports or attend any more meetings as long as I live.


I will have a chat with Chesterfield about this. Good idea. Reluctantly, in view of your last sentence, may I ask you to read this text copied from the parliamentary notes?
It may or may not be advantageous for tax purposes, if it turns out to be true, but...

On 1 April 2012 the Government transferred Royal Mail’s historic liabilities of around £40 billion from Royal Mail’s pension scheme to a new *public sector scheme* (the Royal Mail Statutory Pension Scheme, RMSPS) to be administered by the government.

clearly seems to be saying that your pension, and mine, are now public sector pensions.
That generates a new question. Are public sector pensions taxable only in the UK?


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## Aron (Apr 30, 2013)

Muggers said:


> I will have a chat with Chesterfield about this. Good idea. Reluctantly, in view of your last sentence, may I ask you to read this text copied from the parliamentary notes?
> It may or may not be advantageous for tax purposes, if it turns out to be true, but...
> 
> On 1 April 2012 the Government transferred Royal Mail’s historic liabilities of around £40 billion from Royal Mail’s pension scheme to a new *public sector scheme* (the Royal Mail Statutory Pension Scheme, RMSPS) to be administered by the government.
> ...


I do understand what you are saying, however, through the whole process we were kept up to date by the trustees. The HMRC and the pension scheme are aware of my circumstances. I am certain the helpline will give you the advice you seek. I am quite content to pay my taxes here in Spain. The fact the government took over the deficit does not appear to have altered the terms of my pension contract. The trustees did not relay that as I remember.


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## Muggers (May 15, 2014)

Aron said:


> I do understand what you are saying, however, through the whole process we were kept up to date by the trustees. The HMRC and the pension scheme are aware of my circumstances. I am certain the helpline will give you the advice you seek. I am quite content to pay my taxes here in Spain. The fact the government took over the deficit does not appear to have altered the terms of my pension contract. The trustees did not relay that as I remember.


I will post the response from Chesterfield in due course.


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## CapnBilly (Jun 7, 2011)

A pension from the Post Office is defined as a non- government pension by HMRC under the terms of the Double Taxation Agreement (DTA). Having said that, the benefits of being a government pension (double allowances etc) disappear with effect from the 1st January 2015 under the new DTA that comes into effect on 12th June 2014.


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## Maureen47 (Mar 27, 2014)

Does an NHS pension count as a gov pension and therefore not get taxed in Spain , I have never heard of this before !


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## CapnBilly (Jun 7, 2011)

maureen47 said:


> Does an NHS pension count as a gov pension and therefore not get taxed in Spain , I have never heard of this before !


If it's paid by a local authority, then it's considered to be a government pension, if it's paid by Capiita, then it's not.


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## NickH01 (May 4, 2014)

Most Civil Service pensions are paid by Capita.


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## Maureen47 (Mar 27, 2014)

CapnBilly said:


> If it's paid by a local authority, then it's considered to be a government pension, if it's paid by Capiita, then it's not.[/QUOT
> 
> Thanks employment is with the NHS not a Civil Service Dept so not sure who will pay it but will check as I didnt realise this was the case


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## CapnBilly (Jun 7, 2011)

NickH01 said:


> Most Civil Service pensions are paid by Capita.


The question was about an NHS pension, to which the answer is the one I gave. If it's an NHS pension paid by Capita, then it is not a government pension.

Civil Service Pensions paid by Capita are different, because they are paid under a commercial management contract, which is completely different, the pensions are still considered to be a government pension.


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## Aron (Apr 30, 2013)

maureen47 said:


> CapnBilly said:
> 
> 
> > If it's paid by a local authority, then it's considered to be a government pension, if it's paid by Capiita, then it's not.[/QUOT
> ...


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## mrypg9 (Apr 26, 2008)

Aron said:


> I used to be involved with the CMA and read every report I had to. When I retired I decided to read no more reports or attend any more meetings as long as I live.


You clearly have a stronger resolve than I
I vowed that too but within a year of coming to Spain I got involved in helping run an animal rescue charity, joined a political party and am now involved with another organisation that issues many reports and holds very many meetings all over Andalucia


Where's the 'envy' smilie??


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## Muggers (May 15, 2014)

Aron said:


> maureen47 said:
> 
> 
> > With my post office pension, the HMRC give me an NT tax code, therefore I know I have to pay that tax in Spain. They also give my NT code to the pension fund. I then get paid my pension gross.
> ...


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## Aron (Apr 30, 2013)

Muggers said:


> Aron said:
> 
> 
> > May I ask if your pension began before the government takeover in 2012? I am waiting for clarification from Chesterfield, but it may be that if indeed the pension is now classed as public sector, your tax status in the UK may stem from before the takeover, if it was payable before that.
> ...


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## Aron (Apr 30, 2013)

mrypg9 said:


> You clearly have a stronger resolve than I
> I vowed that too but within a year of coming to Spain I got involved in helping run an animal rescue charity, joined a political party and am now involved with another organisation that issues many reports and holds very many meetings all over Andalucia
> 
> 
> Where's the 'envy' smilie??


The CMA is now part of UNITE. I was a managerial union rep. I did much of the work in my own time and got no pay for doing it. I had to attend many meetings from director level to the rank and file. I got very little thanks as many thought I was on a jolly. It became quite stressful. I don't do meetings any more, people sticking their fingers in the air and saying how things should be done. If they really cared, they should get involved and do it themselves.

I walk every morning and one day saw so many stray animals, I wrote a poem as I walked, then went home and tried to write it down. It's one way to relieve stress!


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## mrypg9 (Apr 26, 2008)

Aron said:


> The CMA is now part of UNITE. I was a managerial union rep. I did much of the work in my own time and got no pay for doing it. I had to attend many meetings from director level to the rank and file. I got very little thanks as many thought I was on a jolly. It became quite stressful. I don't do meetings any more, people sticking their fingers in the air and saying how things should be done. If they really cared, they should get involved and do it themselves.
> 
> I walk every morning and one day saw so many stray animals, I wrote a poem as I walked, then went home and tried to write it down. It's one way to relieve stress!


I agree with every word you say. My own experience was similar to yours both as a voluntary worker for my union after I retired and when I was a Councillor. 
Because my retirement work representing my union involved regular flying from my home in Prague to London and various European cities people assumed I must be having a riotous time. The fact was, as you will know, that I got to see the cities on the way to and from the airports as most meetings ended late and after dinner I was straight off to bed in my hotel which is no way like your bed at home.
Then there are people who think flying is interesting and exciting....maybe it is if you fly once a year.
A lt of people assumed I got paid for my union and political work. In fact I saved my union a lot of money as if I hadn't one of the paid staff would have done the work I did gratis.
As for the political work....it seems taken for granted that every elected politician at any level must be dim, corrupt, raking it in, in someone's pocket...In fact I lost money as I turned down promotion chances until I stood down from elected office.
But I enjoyed it as I wouldn't have done it otherwise.


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## Dunpleecin (Dec 20, 2012)

As an outsider looking in, but with an interest in the topic because I do claim a fully fledged government pension, it seems to me that notwithstanding the initial arguments re the government taking over this that and the other, I think that what matters is what job did you do when working? if you were a crown servant then yes, your pension should be a government one but if you worked for what in essence was a private company, then I can't see how that status would change.


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## Aron (Apr 30, 2013)

Dunpleecin said:


> As an outsider looking in, but with an interest in the topic because I do claim a fully fledged government pension, it seems to me that notwithstanding the initial arguments re the government taking over this that and the other, I think that what matters is what job did you do when working? if you were a crown servant then yes, your pension should be a government one but if you worked for what in essence was a private company, then I can't see how that status would change.


I think for those that don't understand the post office pension fund, they should google why governments in the 80's and early 90's decided not to pay their pension contributions. Instead the money went into government coffers. That is one reason why the pension fund got into deficit and why it was necessary for the present Tory government to bale it out, to privatise it!


http://www.express.co.uk/news/uk/87061/Royal-Mail-s-13-year-8bn-pension-break


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## Nignoy (Jun 4, 2010)

mrypg9 said:


> I agree with every word you say. My own experience was similar to yours both as a voluntary worker for my union after I retired and when I was a Councillor.
> Because my retirement work representing my union involved regular flying from my home in Prague to London and various European cities people assumed I must be having a riotous time. The fact was, as you will know, that I got to see the cities on the way to and from the airports as most meetings ended late and after dinner I was straight off to bed in my hotel which is no way like your bed at home.
> Then there are people who think flying is interesting and exciting....maybe it is if you fly once a year.
> A lt of people assumed I got paid for my union and political work. In fact I saved my union a lot of money as if I hadn't one of the paid staff would have done the work I did gratis.
> ...


But surely the voluntary work you did was your own choice and turning down promotion was your own choice too,everyone orchestrates their own future, many of us has had jobs where our ideaology has leadto more peace of mind and benefits for our fellow man, than for our own comfort,but that is called life!!


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## Muggers (May 15, 2014)

Still waiting for a reply from the Chesterfield Helpline on my original question about the status of the Royal Mail Statutory Pension Scheme (RMSPS) since its establishment.
Meantime, would a statement from Michael Fallon, Secretary of State for Business, Innovation and skills be sufficient?
On 9 July 2013, in a reply to MP Chris Ruane, the Secretary of state said

" On 1 April 2012 the Government relieved Royal Mail of its historic pension deficit of approximately £12 billion by transferring pension benefits accrued up to that date to a new *Government* *pension scheme*. *This new Government pension scheme* was established under Part 2 of the Postal Services Act 2011 and *is known as the Royal Mail Statutory Pension Scheme (RMSPS)" *Source: Hansard written answers.

If the responsible minister himself says, in a written answer, that RMSPS is a Government pension, I dont see what higher authority there is that can say it isnt.
Muggers


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## Aron (Apr 30, 2013)

Muggers said:


> Still waiting for a reply from the Chesterfield Helpline on my original question about the status of the Royal Mail Statutory Pension Scheme (RMSPS) since its establishment.
> Meantime, would a statement from Michael Fallon, Secretary of State for Business, Innovation and skills be sufficient?
> On 9 July 2013, in a reply to MP Chris Ruane, the Secretary of state said
> 
> ...


I simply do as HMRC tell me to do. They issue me with an NT tax code which means I pay no tax on my Royal Mail pension. They have recently given me a NT tax code unti April 2015. If anything changes, they will inform me. If Chesterfield do not help you, ask the tax office that deals with your tax in the UK!


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## Aron (Apr 30, 2013)

Nignoy said:


> But surely the voluntary work you did was your own choice and turning down promotion was your own choice too,everyone orchestrates their own future, many of us has had jobs where our ideaology has leadto more peace of mind and benefits for our fellow man, than for our own comfort,but that is called life!!


How can you say everyone orchestrates their own future. Millions of honest hard working people having been made redundant would be annoyed at that statement!


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## Nignoy (Jun 4, 2010)

Aron said:


> How can you say everyone orchestrates their own future. Millions of honest hard working people having been made redundant would be annoyed at that statement![/QUOTE As a 90%disabled war veteran,I retrained and made my way,then 20 years on through a family tragedy I had to leave my job as Headkeeper of a prominent german zoo,and move back to UK, no jobs in uk in my trade so I went into security and driving, my wife died but I carried on,saved a bit of money , met anew lady ,and at the age of 53 emigrated to Australia without a proverbial pot to pee in!!arrived on a Thursday had a start as an agricultural machine operator on the Monday, eventually got a chance to work with animals,but it meant moving 300 miles, so I moved, now I am 71 years of age, my wife and I are moving via Germany to spain, maybe when I.m 80 we will look somewhere else,when the weather gets cold and damp the amount of steel and bionic implants in my body put me in a world of hurtand I can hardly move I feel like giving up!! But what I wont do like so many people I know, is sit at home with a *** and a couple of cans feeling sorry for myself because I have been made I redundant!! Talk to me about being made redundant I come from the Rhonda I come from5 generations of coalminers , 19 of my cousins ,uncles and grandfather were made redundant,some stayed the rest moved and made their own future!!!


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## mrypg9 (Apr 26, 2008)

Nignoy said:


> But surely the voluntary work you did was your own choice and turning down promotion was your own choice too,everyone orchestrates their own future, many of us has had jobs where our ideaology has leadto more peace of mind and benefits for our fellow man, than for our own comfort,but that is called life!!


Where did I sáy it wasn't my choice? Of course it was.
It is of course quite silly to say that everyone 'orchestrates their own future'. Tell that to the seven million unemployed in Spain. Did they choose to be on the dole, some for years?
I have been very lucky in my life in that to a large extent I have been able to make choices. I had an income sufficient enough to enable me to turn down promotions. Many people, through no fault of their own, are notin that position.
I read with interest your unusual life story in your reply to Aron. I remember you posting it a few months back with a lot more detail. From your posts it seemed you were about to pay a factfinding visit to Spain with a view to purchasing a property.
So haveyou changed your mind in favour of Germany?
Many people have stories they can tell of hardship and misfortune in life. Some surmount their handicaps, others don't.
Often the outcome either way is down to good or bad fortune. We all know that one main feature of lifeis that it isn't fair, don't we....


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## Nignoy (Jun 4, 2010)

*Still Travelling*



mrypg9 said:


> Where did I sáy it wasn't my choice? Of course it was.
> It is of course quite silly to say that everyone 'orchestrates their own future'. Tell that to the seven million unemployed in Spain. Did they choose to be on the dole, some for years?
> I have been very lucky in my life in that to a large extent I have been able to make choices. I had an income sufficient enough to enable me to turn down promotions. Many people, through no fault of their own, are notin that position.
> I read with interest your unusual life story in your reply to Aron. I remember you posting it a few months back with a lot more detail. From your posts it seemed you were about to pay a factfinding visit to Spain with a view to purchasing a property.
> ...


We are still on our travels ,Germany is only a family interlude ,and my wife has never experienced the beauty of Bavaria, next week we travel north more relatives and friends, then a very short English interlude, and then we head down to Mojacar, our little pooch has recovered from the long flight, and she is a legal European, my wife seems to really like it here in deepest Bavaria and the idea has been mentioned summers here and winters in Mojacar, but we will see what happens, we don't have a schedule , but we shall see what happens


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## slatts (Sep 17, 2013)

*Royal Mail Pension*

I am receiving an RM pension and have asked the pension team for clarification on its status with the Government taking over the payments and this was the response


"The scheme is still an Occupational pension as Royal Mail contributed to this, despite the Government paying the benefits; it is not linked to state benefits".

This suggests that it is not classed as a Government Pension for taxation purposes etc. so no change to current arrangements


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## Muggers (May 15, 2014)

slatts said:


> I am receiving an RM pension and have asked the pension team for clarification on its status with the Government taking over the payments and this was the response
> 
> 
> "The scheme is still an Occupational pension as Royal Mail contributed to this, despite the Government paying the benefits; it is not linked to state benefits".
> ...


I am still trying to get clarification from the pension administrators. So far they have only been able to come up with the standard reply of ..."its a statutory occupational scheme...etc" But that doesnt say anything about its status for tax. A government pension can be described in those terms, as can a non government one.
The RMSPS clearly falls under the category of a public service pension according to the finance act, but HMRC describe it as non government. However, HMRC refer to "Post Office" pensions. That term may apply to the ongoing Post Office scheme, but I am not sure if it applies to the RMSPS, which was created as a distinct entity and has been described in official literature as a "new public sector scheme"
I will keep banging away at this until I get a definitive answer from someone official.


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## extranjero (Nov 16, 2012)

Muggers said:


> I am still trying to get clarification from the pension administrators. So far they have only been able to come up with the standard reply of ..."its a statutory occupational scheme...etc" But that doesnt say anything about its status for tax. A government pension can be described in those terms, as can a non government one.
> The RMSPS clearly falls under the category of a public service pension according to the finance act, but HMRC describe it as non government. However, HMRC refer to "Post Office" pensions. That term may apply to the ongoing Post Office scheme, but I am not sure if it applies to the RMSPS, which was created as a distinct entity and has been described in official literature as a "new public sector scheme"
> I will keep banging away at this until I get a definitive answer from someone official.


Sounds like you'll be paying income tax in Spain, then!
Don't worry- you pay less tax than in UK?


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## Aron (Apr 30, 2013)

Muggers said:


> I am still trying to get clarification from the pension administrators. So far they have only been able to come up with the standard reply of ..."its a statutory occupational scheme...etc" But that doesnt say anything about its status for tax. A government pension can be described in those terms, as can a non government one.
> The RMSPS clearly falls under the category of a public service pension according to the finance act, but HMRC describe it as non government. However, HMRC refer to "Post Office" pensions. That term may apply to the ongoing Post Office scheme, but I am not sure if it applies to the RMSPS, which was created as a distinct entity and has been described in official literature as a "new public sector scheme"
> I will keep banging away at this until I get a definitive answer from someone official.


You talk to the Inland Revenue in the UK. If they give you an NT tax code then you will pay your taxes in Spain. You do not need to ask the pension administrators, they get their information from HMRC. If you get an NT code, your pension will not get taxed in the UK.


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## CapnBilly (Jun 7, 2011)

Aron said:


> You talk to the Inland Revenue in the UK. If they give you an NT tax code then you will pay your taxes in Spain. You do not need to ask the pension administrators, they get their information from HMRC. If you get an NT code, your pension will not get taxed in the UK.


.....and if it's not on their list as a government pension, which it's not, then that's your definitive answer, and you will get an NT code, and have to pay tax in Spain, and probably more than you would in the UK.


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## Aron (Apr 30, 2013)

CapnBilly said:


> .....and if it's not on their list as a government pension, which it's not, then that's your definitive answer, and you will get an NT code, and have to pay tax in Spain, and probably more than you would in the UK.


Absolutely correct.

I have a RM pension and that fact is, if I pay more tax in Spain, it is irrelevant. That is the way it is. I want to live in Spain, some taxes I pay are more and some are less and at the end of the day, I still find it cheaper to live in Spain than the UK. 
Every UK citizen should receive a tax code. If a person has an NT code, you pay all your income in Spain. If you have a tax code other than NT, HMRC will tell you why.


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