pension TRUSTEES LIMITED Leaving before retirement? All you need to know

pension TRUSTEES LIMITED Leaving before retirement? All you need to know

Your pension When you leave the Tesco PLC Pension Scheme (the Scheme) we will write to you with details of your pension. We will send you details of: The value of the pension you have built up to the date of leaving Your Cash Equivalent Transfer Value (CETV) If you are over age 55 when you leave, we will also include figures for taking your pension early. If you leave your pension with Tesco you can apply to take early payment of your pension from age 55, or we will contact you at Normal Retirement Age which is age 65 for males and females to arrange payment. The pension will be reduced if you take it early. Will my pension increase? If you leave your pension with the Scheme, it will increase every year on the anniversary of your date of leaving, in line with inflation (up to a maximum of 5% each year). When your pension is in payment it will also increase in line with inflation up to a maximum of 5%. If you have been receiving your pension for less than a year, you will receive a proportion of the increase based on the number of months your pension has been paid for. If you were a member of the Scheme before 6 April 1997, you may have a Guaranteed Minimum Pension (GMP). The GMP represents the additional State Earnings Related Pension you could have built up, instead of which you get a Tesco pension which must be at least equal to your GMP. This part of your pension increases every 6 April from the first full tax year after you leave. Government decides the increases which are based on increases in average earnings.

What happens if I die before I take my pension? As you have left the Scheme you are no longer covered by the Scheme s life cover. If you decide to leave your pension benefits with Tesco, and you die before taking your pension, the Scheme could pay: A spouse or dependant s pension The Scheme will pay a dependant s pension to your widow, widower or civil partner. If you do not leave a spouse or civil partner, the Scheme will also consider payment to a financially dependant partner. The dependant s pension is 60% of your pension. Lump sum A lump sum of five years pension will be paid as a tax-free sum. The Trustees have discretion as to whom to pay it to, and will take your Expression of Wish into account when making their decision. If you need to change your Expression of Wish please contact the Pensions Team. Children s pension The Scheme will pay a pension to your children if they are under 16, or if they are in full time education or training, up to age 23. The pension is 25% of your pension for one child, or 40% of your pension for two or more children. Children s pensions are doubled if no spouse s or dependant s pension is payable.

Including ill health cover If, after leaving the Scheme, you become seriously ill and it permanently affects your ability to work in any way, it may be possible for your pension to be paid early. Please contact the Pensions Team to discuss your options. What is the Expression of Wish form? If you die and a cash sum is payable, the Trustees have discretion as to whom to pay it to. Your Expression of Wish tells the Trustees whom you would prefer this money to be paid to, although they are not legally bound by it. You can nominate any person or organisation and the money can be divided between several people or organisations. If the Trustees decided to pay the money to a person under 18, they may arrange for a trust fund to be set up. If your circumstances change, or you want to alter your wishes, please contact the Pensions Team.

Additional Voluntary Contributions (AVCs) If you paid Additional Voluntary Contributions (AVCs), they stay with your Tesco pension. This means that: If you transfer your pension to another provider your AVCs will also be transferred If you leave your pension with the Scheme, your AVCs stay invested We will send you a statement each year so you can see how your investment is performing. When you retire, you can currently take your AVC fund as part of your tax-free cash lump sum (up to Revenue limits) or exchange it for Tesco pension, or a combination of the two. You can instead choose to buy a pension from another pension provider like an insurance company. You can change your AVC investment or request a statement of your investment at any time. Contact the Pensions Team for more information. State pension The State Pension is made up of: Basic State Pension State Second Pension (S2P). (This replaced State Earnings Related Pension Scheme (SERPS) in April 2002) How much Basic State Pension you get depends on how many years you have paid National Insurance contributions. The Scheme is contracted out of S2P so instead of SERPS/S2P, you get a Tesco pension. If you pay National Insurance, you will have paid lower National Insurance contributions while you were a member of the Scheme. The Scheme should pay you a pension of at least the amount of pension you would have got from the State as your SERPS/S2P pension while you were a member. You can get details of State benefits from the Department of Work and Pensions (DWP). Contact the DWP on 0845 300 0168 or visit their website at www.dwp.gov.uk.

How to find out more... This guide is a high level summary of the scheme. For full details, please view the full scheme booklet Pension Builder Scheme Guide which is available under the Forms and information section of our website. www Pensions Website: www.pensionwebsite.co.uk User ID: tesco Password: mypension Post: Pensions Team, PO Box 4126, Cardiff CF14 4ZP Helpline: 0845 070 1113 local rate number (Monday to Friday from 8am to 5pm and Saturday 8am until midday) @ Email: pensions.dept@uk.tesco.com Important notes - Every effort has been made to make sure that the information in this guide is correct at the time of publishing. This guide is intended to give an overview of some of the benefits which are available under the Pension Builder section of the Scheme, and a summary of some of the Rules of the Scheme. Please note that Tesco has the right to change the Scheme, or stop future benefit accrual, at any time. The Rules are a binding document and if there is any difference between this guide (or any other communications about the Scheme) and the Rules, the Rules will always prevail. There are certain general communications that we are legally required to send to all members. The Trustees plan to give this information to members electronically - either by email or through a website. Please contact us (including your name and employee number) if you want to opt out of receiving these items electronically. If you re happy to receive general information by email please send us your email address. UK Pension Scheme of the Year 2012 Tesco Pension Trustees Limited. 2012 December 2012