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The Resettlement Grant
Many of you will be leaving the Armed Forces with a Resettlement Grant (RG). The RG is a tax-free lump sum intended to help Regular Service personnel settle into civilian life. There is no stipulation as how you use it – you can spend it on beer if you like, but you need to remember that, if you take up another military post too quickly, you might have to repay some or all of it. In this short article Mary Petley of the Forces Pension Society explores the rules relating to RGs …
Let’s look first at the RG qualification criteria:
- AFPS75: Officers must give at least nine years’ Reckonable Service (RS) from age 21, and Other Ranks (ORs) must give at least 12 years’ RS from age 18.
- AFPS05: The member must give at least 12 years’ relevant service.
- AFPS15: The member must give at least 12 years’ relevant service.
In all cases, if the member qualifies for another terminal benefit, the RG is not payable. The terminal benefit could be an Immediate Pension, Early Departure Payment Scheme benefits or Ill-Health benefits.
Those who were transferred to AFPS15 have protected benefits in their ‘old’ scheme, and that includes the RG. Only those who joined or re-joined the Regulars on or after 1 April 2015 will received the AFPS15 RG. Only Regular service counts towards the qualification criteria for RG.
Some of you will have left with preserved AFPS75 benefits and re-joined after 6 April 2005, thus becoming AFPS05 members. In these circumstances you are entitled to count both periods of service towards your AFPS05 RG – you do not have to ask for this to happen, it is automatic. A few of you might have left AFPS75 or AFP05 with preserved benefits only (i.e. no other terminal benefits) and re-joined the Regulars on or after 1 April 2015. In these circumstances, and providing you re-joined within five years of your previous discharge date, you will be able to count the period of that earlier service towards qualification for the AFPS15 RG. Again, this is automatic.
So, how much are we talking about (at 2019/20 rates, as 2020/2021 rates have not yet been published)?
- AFPS75 Officers’ RG is £16,272
- AFPS75 Other Ranks’ RG is £11,121
- AFPS05 and AFPS15 RG is £11,423 for all
And, remember, it is tax-free cash!
If, having received an RG, you re-join the Regulars or accept an FTRS post, you need to remember the required breaks:
- For AFPS75: 121 days if you are re-joining the Regulars and 30 days if you are joining the FTRS. So, for example, if you re-joined the Regulars 60 days after leaving with an RG, you would have to pay back just over half (approx. 50.4%) of the RG. If you join the FTRS within 30 days the whole RG must be repaid.
- For AFPS05 and AFPS15: If you re-join the Regulars or join the FTRS within 31 days, the whole RG must be repaid.
- For all schemes, the RG is not affected by joining the PTVR.
If you leave and re-join the Regulars, and then leave again before terminal benefits are payable, you may still qualify for RG:
- If you received an RG and did not have to repay it, you will not be entitled to a second RG, even if you are not entitled to any other benefits payable immediately.
- If you repaid a proportion of your AFPS75 RG on re-joining as an AFPS05 member, you will be entitled to a proportion of the RG for AFPS05. So, using the example above, an individual who repaid 50.4% of the AFPS75 RG on re-entry would be entitled to 50.4% of the RG payable at the date of leaving for the second time.
- If you repaid the whole RG, you will be entitled to the full RG for your new scheme.
Get in touch with the Forces Pension Society
If you are a member of the Forces Pension Society and have any pensions-related questions, contact us by sending an email. If you are not a member but would like to know more about us, visit our website for full details.
The Forces Pension Society is the trusted source for independent Armed Forces Pension advice. We exist to advise members on the technical aspects of their Armed Forces Pension, campaign against any injustices in the policy provision or maladministration of Armed Forces Pensions, and educate the Armed Forces community on all pension matters.
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