Eligibility

In order to be eligible you must normally be a United Kingdom resident.*

There is no minimum age for a Stakeholder pension however if you are under age 18 (16 if employed) the contract may only be entered into by your legal guardian. The contract is then the responsibility of your legal guardian until you reach age 18 (16 if employed). The maximum age at which you can take out our Stakeholder pension is 74.

Only controlling directors and high earners who are members of their employer’s occupational pension scheme in respect of every source of earnings are unable to contribute to a Stakeholder pension.

If you are physically incapacitated an application can be made on your behalf by a person acting under a power of attorney. If you are mentally incapacitated an application can be made by an attorney or receiver appointed on your behalf. Applications can also be made under a Scottish power of attorney granted after 1/1/91.

If you are employed and you are below the State Pension Age, you may also use the Stakeholder Pension to contract out of the State Second Pension (S2P, formerly SERPS).

If you are a member of an employer's occupational pension scheme you may also be eligible to join a Stakeholder pension. This is called concurrent membership and is described in detail under the section ‘What if I am a member of my employer’s pension scheme?’

* Actually you must be either resident and ordinarily resident in the United Kingdom at some time during the current tax year. Or, if you are serving abroad and undertaking Crown duties, or the husband or wife of such a person, you are also eligible. If you are a UK resident then later move abroad you may still be eligible to contribute for at least another 5 years although contributions may be restricted to the earnings threshold.

What if I am a member of my employer's pension scheme?

There are certain circumstances where this section will not apply to you, these are
- if you are a member of an occupational pension scheme which provides death in service benefits only
- if you are a member of an occupational pension scheme and are joining this Stakeholder pension to solely contract out of S2P.

If you fall into any of these categories you are eligible to join this Stakeholder pension without referring to the following or completing the Concurrency section of the application form.

If you are a member of an employer's occupational pension scheme you may also be able to contribute to a Stakeholder pension. This is called concurrent membership and is only possible if you are not, and have not been in any of the 5 previous tax years, a controlling director. You must also have earned less than the remuneration limit for one of those years and select one as what is called a Qualifying year.

The Qualifying year must be nominated on your application and must meet the following criteria,
- must be any one of the previous 5 tax years
- must not be before the 2000/01 tax year
- you must have been employed on 5th April in that year and the annual equivalent of those earnings must not exceed the current renumeraton limit of £30,000.
Once the Qualifying year has been established contributions may be made during the 5 years following the Qualifying year. A new Qualifying year must then be nominated. We would contact you when this is due.

If you have only worked in pensionable employment for part of the Qualifying year you must proportion those earnings up to provide the equivalent of a whole year's earnings, to determine if it exceeds the remuneration limit for that year.

In order to establish if you are eligible for concurrent membership you must complete the concurrent membership certificate on the application form. If you are eligible you will be able to contribute up to what is called the earnings threshold for the current tax year. The earnings threshold for the 2005/06 tax year is £3,600. If you are not eligible you will not be able to contribute to a Stakeholder pension.

If you have just joined your occupational pension scheme in the current tax year and do not have any previous earnings from an office or employment you will be unable to nominate a qualifying year at this time. In this instance if your earnings for the current year are likely to meet the qualifying year requirements for the next tax year (i.e. will be less than £30,000) please complete the concurrency certificate on the application using your current year details and indicate on the form that you have for the first time joined an occupational pension scheme. We will set your policy up on a non concurrent basis in this tax year and then amend your policy to a concurrent basis in the next tax year. If you later find that your actual earnings in the current tax year were greater than the qualifying year limit of £30,000 please notify us as your contributions will have to stop before the next tax year.

One exception to this process will be if you first joined an occupational pension scheme on the 6th April in the current tax year. In this situation only, HM Revenue & Customs will allow this tax year to be the Qualifying year.

Note - If you have any source of earnings in respect of which you are not a participating member of an employer's occupational pension scheme then you should contribute to this pension scheme based on these earnings and concurrency will not apply.