Frequently Asked Questions
Here are some of the frequently asked questions that may help you understand the Investor Plan.
All administration costs are currently met by Siemens but you will meet the costs of the investment option you choose. Each option has an Annual Management Charge and this is stated in the Investment section of this guide.
Please note charges can change at any time, for the latest information please visit Fidelity.
The Company currently meets all administration charges. However, the Trustees reserve the right to introduce charges for members who make frequent changes. In unusual circumstances (such as when many people want to move out of a particular fund), switching funds may incur indirect costs. This is because investment managers can reflect the costs of buying and selling assets in the fund’s pricing.
Pension rights are normally taken into account as part of a couple’s assets. There are a number of options available to the court in dealing with pension rights. We will comply with any instructions from the court. If you need more divorce related pension information, please contact the Member Services Team.
The Trustees’ role is to run the whole of the Siemens Benefits Scheme, making decisions on behalf of members, ensuring that the Plan is operated in accordance with the rules and within the law. The Trustees are also responsible for monitoring the investment funds available in the Investor Plan and making changes to these where appropriate. However, as a member of this Plan, it’s up to you to choose how much you contribute and how you invest your contributions within the range of options available to you.
If your complaint cannot be resolved by the Member Services Team, there is a two-stage formal process for resolving disputes:
1 - Write to the Secretary to the Trustees at Pension Services, PO Box 131, Blyth, NE24 9FB. You will receive a response within a month.
2 - If you are not satisfied with the Secretary’s decision, you can write to the Trustees at the above address. You must write within six months of the Secretary’s decision. Your complaint will be considered at a board meeting and these are held quarterly. You will receive a letter following the meeting explaining the outcome. So, when you can expect a response depends on when your complaint is received.
If you are not satisfied by the result of the internal procedure you can contact The Pensions Ombudsman.
Your basic pay plus any bonuses and commission paid, plus for members of MyChoice an amount equal to the reduction in your pay as a result of the salary conversion process. Overtime is not included in the calculation of pensionable salary.
These are contributions you choose to make into the pension Plan. They stand for Employee Directed Contributions and Additional Voluntary Contributions.
Thinking of making a contribution above 10%?
If you would like to pay more than 10% then you can:
Contribute up to 35% of your pensionable salary by making Employee Directed Contributions (EDCs), you can choose to do this on MyChoice.
You can also make regular or lump sum contributions at any time up to your full monthly earnings (less National Insurance and any other deductions). These are known as Additional Voluntary Contributions (AVCs). You can make or change Additional Voluntary Contributions through MyChoice.
Visit the MyChoice website for further details.
This is the amount by which your pension savings can increase in value each year without HMRC imposing a tax charge. For the Plan, both your contributions and Siemens contributions count towards the Annual Allowance.
The Annual Allowance is normally £40,000, but if you earn over £200,000 or have flexibly accessed your pension savings it could be less. For the higher earners, the standard Annual Allowance is tapered down from £40,000 to £4,000 if your income is £312,000 or more. Broadly, this is achieved by applying a £1 reduction to the Annual Allowance for every £2 of income over £240,000 (such income being calculated before deduction of your pension contributions but then increased by employer pension contributions).
If you exceed the Annual Allowance, any excess will be taxed at your marginal rate, however, you may be able to carry forward unused relief from previous tax years. Any pension “input” (that is contributions or benefit increases) in addition to contributions to the Plan will also count towards the Annual Allowance. This is a complex area so we would suggest speaking to a financial adviser if this affects you.
HMRC imposes a limit on the total value of pension benefits that you can build up without incurring a tax charge during your lifetime, including your Plan benefits and benefits from other pension arrangements, except those from the State. When you take any benefits from the Plan, their value will be checked against your available Lifetime Allowance.
The Lifetime Allowance for the tax year 2020/21 is £1,073,100. However, the Government currently intends to increase each year broadly inline with the increase in the Consumer Prices Index (CPI), over the year ending in the September prior to the beginning of the tax year in question. Benefits built up above the Lifetime Allowance will be taxed, currently at an overall rate of 55% if paid out as a lump sum. If you think that you may be affected by the Lifetime Allowance charge, we recommend that you speak to a financial adviser.