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spiceyandcoke
28-02-2012, 18:55
Ok so have tried to read most of the posts on here about med discharges and entitlements etc etc but have a question i cant find the answer for. If you have done your 22 and could leave and get an IP but get medically discharged does your pension become tax free? I am on to los 30 have past 22 year point and am staring down the barrell of a permenant downgrade, obviously i am aware you get 3 choices....carry on at low mes remuster or leave if i choose leave is the pension tax free??
Any good advice would be appreciated i had an accident pre 1st april 2005 so cant claim until i get out do you still need to be 15% to get anything?

Sospan
28-02-2012, 19:06
Depends if your reason for Invaliding was caused or made worse by the Service.

busby1971
28-02-2012, 19:08
Leave as normal, pension taxed (no rises until 55) but you can apply for a war pension which will be tax free,

Medical discharge with service invaliding pension (taxed), but get war pension for main condition and it becomes a service attributable pension and it all becomes tax free sips and saps attracts annual rises but you cannot commute.

There you go

Sent with predictive text, apologies for bad wording

spiceyandcoke
28-02-2012, 21:12
Cheers for the replies pretty much what i thought but heard a rumour that the pension was tax free hence the post...... as for the war pension i believe thats done on a % thingy correct me if i am wrong. And yes the injury was done in the service and plodding my way up and down the gym and working on a/c has certainly made it worse

Great Uncle Bulgaria
29-02-2012, 08:41
Cheers for the replies pretty much what i thought but heard a rumour that the pension was tax free hence the post...... as for the war pension i believe thats done on a % thingy correct me if i am wrong. And yes the injury was done in the service and plodding my way up and down the gym and working on a/c has certainly made it worse

As someone who has first hand experience of this...the war pension is a percentage award and if it's low you get a taxed lump sum. If it's high, it gets taxed but you get a lifetime award which can increase if the condition worsens.
If you get a service invaliding pension, it is paid tax free and rises (or remains frozen) in line with all other pensions annually. That's the one I get, so that's from the horses mouth, not a rumour. Initially, it will be taxed, but a letter/e-mail confirming my medical discharge to Xaffinity seemed to correct that. I don't pretend to understand how the amount is worked out, I'd done 18 years, so I presume I get 18/22nds of a full pension.
What you may hear though is that you will be also entitled to a normal RAF pension at age 55. That is not correct as you'd be being paid 2 pensions for the same period of service (confirmed in writing by SPVA).

Great Uncle Bulgaria
29-02-2012, 08:48
....Any good advice would be appreciated i had an accident pre 1st april 2005 so cant claim until i get out do you still need to be 15% to get anything?

I believe 15% is the point at which you get paid a monthly award. I was initially declared at less than that so got a one off lump sum. To be honest, I didn't want the discharge and would have been willing to serve on a permanently lowered MES but wasn't permitted as I became non deployable. I was tentatively told about a possible remuster to Scribbly whilst at the Med board at Henlow (my only conversation about remuster), but as that would not have changed much, I was discharged that day as "Unfit for further Service". That left me with a huge empty feeling, knowing that I'd gone from having a career to nothing in one signature, so please be aware of that as well. It's not a nice feeling (dependant on how you feel about the RAF).

busby1971
29-02-2012, 19:18
UB you`re a bit off there on a couple of points, I`m pretty sure you`ve got your own situation right but all War Pensions are paid free of tax and do not use up your tax free allowance. In my case my Normal Pension paid following 22 (and a bit) years service uses up my tax allowance, all my salary gets taxed but my War Pension comes through in it`s entirety. If you are still getting a SIP rather than a SAP then that will be taxed but will attract annual rises but your War Pension will be ignored for tax, if your SIP is tax free and not just using up your tax free allowance then it is a SAP not a SIP and it`s all free of tax.

War Pension awards below 20% are paid out as a lump sum but once you get to 20% you get about 18 per 10% per week paid every 4 weeks. If you get over 40% you tend to be able to claim for other allowances.

If you are medically discharged early your pension is uprated to take into account your forced exit (not by much) so your pension is probably a little bit more than 18/22th of a normal pension that somebody leaving on redundancy may recieve.

Sent with predictive text, apologies for bad wording

Great Uncle Bulgaria
29-02-2012, 23:27
Like I said, I didn't get a war pension, I got a lump sum that was taxed. I also thought it was reasonably clear that I wasn't too sure at what percentage a war pension is paid and I honestly thought it was taxed. I didn't claim to know everything, just said what happened in my case, so it's good for the OP that you've got more answers on that front than me.
I don't know if I've got a SIP or a SAP. What I do know is that my pension is paid tax free every month, and I also know that it does not affect my income tax. I think it all answers what Spicy needs to know.

busby1971
29-02-2012, 23:45
GUB certainly not picking fault, just clarifying other things under the WP scheme, it get a lot more complicated with injuries under later schemes which may have covered your situation.