How are my contributions invested?
Management of the underlying assets is key to the end value of the
Member's retirement pot. The Trustees of The Menhir RAT have
selected the investments to be offered and into which your
contributions will be invested. A key feature of this RAT is
its aim to work with the local investment community by using
Guernsey-based teams who are accountable and available to their
investors. Each Investment Fund is actively managed by
experts with excellent long-term performance track records, strong
investment processes and ample resources in terms of the team and
financial backing. The Trustees will provide you with
separate information about the investment options and as a Member
you will be able to select the offering which is most appropriate
for you.
As well as a high interest bearing account for those with a
cautious risk profile or nearing retirement, a range of actively
managed Funds has been selected to ensure that your contributions
are continually monitored by investment experts. This style
of investing means that your 'portfolio' will be adjusted according
to market conditions and themes which have been identified as
producing the optimum return The Funds in our Medium Risk profile
are 'multi-asset' and 'multi-strategy'.
How much can be contributed each year?
From 1 January 2011 there is no restriction on the amount which you
can contribute to a pension scheme.
What about tax relief?
From 1 January 2011 tax relief is available on
contributions up to a maximum of £50,000 per annum and is granted
against all sources of assessable income not just net relevant
earnings. The rules regarding contributions and tax relief
prior to 1 January are more complex and if you have any queries
regarding this you should contact the States of Guernsey Income Tax
Authority.
Are transfers from other schemes accepted?
Yes. Providing the existing scheme allows a transfer to be
made to another approved scheme then there are unlikely to be any
problems and you will be able to transfer funds held in another
scheme to The Menhir RAT. Transfers from Schemes outside the
Bailiwick, or which are unapproved may require the prior approval
of the Administrator of Income Tax. Transfers of this type do
not form part of your annual personal contributions.
Can I transfer my RAT into another Plan?
Yes. Subject to approval, you can transfer your accumulated
pension contributions into an alternative approved scheme.
When can I retire?
Normal retirement date under Guernsey law is any age
between 50 and 75. However, although the rules allow you to
retire from age 50 (or earlier in the case of ill health), your
accumulated fund may be smaller than if you had continued to
contribute until for example
age 65 and as such may provide a smaller pension than if you had
remained employed and contributing.
What benefits do I receive?
At retirement the accumulated value of the investments in your
account within the RAT will be used to provide your retirement
benefits. Guernsey legislation currently allows you to elect
to take part of your pension as a tax free lump sum and to use the
remaining value to provide a regular income, often called an
annuity, either immediately or at some time in the future.
You may elect to draw an income from the funds in your account
(often called draw-down) or use the money which has accumulated in
your RAT to purchase an annuity from an insurance
company.
In the event that you elect to receive a pension by draw-down
you should be aware that there is no guarantee that the funds in
your account will be sufficient to pay an annuity until your
death. However, any residual balance will remain within your
estate. In the case of an annuity purchased from an insurance
company the insurer will guarantee to pay the pension on the agreed
terms until your death (or that of your spouse). However, in
return for this they will retain any funds not used by them to fund
the annuity.
Apart from the tax free lump sum, all other payments made by way of
a pension are subject to Guernsey income tax at the rate applicable
at the time of payment. You will be required to provide a
coding notice and will receive your income after the deduction of
tax.
Further information will be made available to you just prior to
your proposed retirement date.
What happens to my pension if I die before
retirement?
In the event that you die before you retire your fund will
be applied to provide your dependants or nominated beneficiaries
either with a lump sum or an annuity. We will ask you to
complete a form nominating your dependants/beneficiaries. In
the case of payment of a lump sum this is not subject to income
tax; however if payment is in the form of a regular pension for
example to a surviving spouse this will be subject to income tax in
the normal way.
What happens to my pension if I die following my
retirement?
This will depend on the decisions you made at the time of your
retirement, however, in general terms if you have elected to use
your RAT to provide a pension for a surviving spouse or dependants
this will continue to be paid to them. Alternatively you may
elect for them to receive any funds left in your account as a lump
sum. In either case payment will be subject to income tax at
current rates. If you have elected to purchase an annuity
from an insurer you will usually have the option of selecting
either an annuity which ceases on death or for payment to continue
to a surviving spouse/dependant, in either case any funds remaining
after the death of the member or his nominated beneficiary will
revert to the insurer.
How are the assets in the Plan managed?
The assets of the Plan are owned by and registered in the
name of the Trustees. The Trustees have selected the
investments which comprise the Approved Investments List.
How do I know which investments to
choose?
The Trustees will provide you with a summary of the investment
options offered which have been categorised into Low, Medium and
Higher Risk for ease of selection. It is also possible
to split your contributions into a combination of risk strategies
should you wish.
NB: Investments can go down as well as up and
any gain will accrue to the Member's account and any loss made by
any investment will also be borne by the Member's account.
How do I access information about the
Plan?
As a Member, you will be provided with on-line access to
information on your Plan via a secure website. The
information contained within the website includes: contact
information, the member booklet and scheme rules, all forms
required to administer the plan, contribution history, details of
the investment options, including links to the individual Fund fact
sheets and Fund managers' sites, valuation page (updated monthly)
and a Member Statement showing details of units held and
purchases/sales. In addition to on-line access you will
receive an Annual Member Statement in hard copy.
What will it cost to join the Plan?
Membership of the Scheme is offered for an establishment fee of
£250 plus a fixed annual charge of £175 which covers all Trustee,
Administration and Investment charges. The underlying
investment managers apply an annual management charge of 0.75% -
1.5% to manage their Funds and may rebate a proportion of their fee
to the Trustees. Fund prices and performance are quoted net
of any such charges which are not debited separately from Members'
plans.