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Leaving the Fund and opting-out

The Fund offers a variety of valuable benefits, so make sure you understand the implications for your future if you are considering giving them up.

Not the right time for you?

Paying into a pension is one of the most secure ways of saving for your life after work. But if you decide it’s not right for you, then you can leave the Fund by opting out.

If you have decided to opt out of the Fund, the first thing you should do is to contact your employer, who will trigger the opt out process on your behalf. They will then contact Railpen, the administrator of your pension to let them know, and Railpen will send you your opt-out pack. 

You should read the information in the pack thoroughly before completing the opt-out form and returning it to Railpen.

 

You should be aware that you would be giving up your death benefit of four times your salary should you die as an active member of the Fund. So think carefully before making a decision.

Leaving or opting out within 2 years of joining

If you leave or opt-out of the Fund within 2 years of joining, you may either:

  • receive a refund of the contributions you have paid, or
  • have a transfer value to another pension arrangement

If you made contributions through BTP’s salary sacrifice arrangement, called Pension Plus, your refund will be paid by BTP rather than Railpen. This is because in Pensions Plus, BTP pays your contributions on your behalf. This means you pay less National Insurance contributions, but all contributions are technically made by the employer.

Leaving or opting out after 2 years of joining

 If you leave or opt-out after 2 years of membership, your Fund benefits will be preserved and increase each year in line with inflation. Preserved benefits are payable from your Pension Age, which is age 55. If you are still employed by BTP, you will need BTP’s consent to take your benefits whilst employed.

If you have Protected Pension Age, you can apply to take your preserved benefits from age 50. Your benefits will be reduced if they are paid before age 55 and you do not have 30 years’ membership in the Fund.

Alternatively, you may be able to transfer your preserved benefits to another pension arrangement.

Rejoining the Fund

If you wish to rejoin the Fund after opting out, you can’t do this until 5 years after the date of opting-out.

You would need the consent of your employer and the Trustee if you wanted to rejoin.