Key features of the Group Personal Pension plan

For employees

The Financial Conduct Authority is a financial services regulator. It requires us, Aegon, to give you this important information to help you to decide whether our Group Personal Pension plan is right for you. You should read this document carefully so that you understand what you’re buying, and then keep it safe for future reference.

It’s important that you read this document, as it gives you the main points about your Group Personal Pension (GPP) plan.

You should read it along with your illustration.

You may be automatically enrolled and your employer will let you know if this is the case. Automatic enrolment has been introduced by the government to encourage more employees to save for their future. If you’re looking for more information about automatic enrolment, visit www.aegon.co.uk/pensionsreform

This key features refers to our current Group Personal Pension plan product terms, as at February 2014.

n To make regular contributions into your plan. If you stop making contributions, the value of your plan will be lower than shown in your illustration.

n To tell us if your circumstances change. For example if you’re no longer resident in the UK, or you no longer have UK earnings.

to you. If this applies to you, please speak to a financial adviser before joining this Group Personal Pension plan.

If you’re automatically enrolled, then unless you opt out during the one month period notified to you, you’ll lose your enhanced or fixed protection.

n If you change your mind and cancel, and the value of your plan has fallen, we may not pay the full amount back. For more information on cancelling, see page five.

If you’re automatically enrolled and decide to opt out within the opt out period notified to you, any contributions you’ve paid will be returned in full.

n What you get back when you take your pension benefits can’t be guaranteed, and may be lower than shown in your illustration.

This could happen for a number of reasons, for example if:

– contributions to your plan stop or are reduced – you start taking your pension benefits earlier than

shown in your illustration – investment performance is lower than the assumed

performance in your illustration – charges increase in future – interest rates are lower than the rates used in your

illustration – tax rules change

n The value of your plan can fall as well as rise, and isn’t guaranteed. You may get back less than you pay in.

You can invest in a range of investment funds which have different levels and types of risk. You can find more details on our funds and specific risks at www.aegon.co.uk/funds/our-range-of-funds

n In some circumstances, we may have to delay a transfer or switch. For example if you invest in a fund that invests directly in property, you may not be able to cash in or switch your investment when you want to. This is because market conditions may make it difficult to sell properties at a fair price. This delay may be for as long as 12 months.

If there is a delay, we’ll use the fund price on the day the transfer or switch is completed. This may be very different from the price on the day you requested the transfer or switch.

n If you transfer from another pension plan, the final pension benefits you’ll receive may be less than you would have got if you’d stayed in your existing scheme under the existing terms.

It may not always be in your best interests to transfer your existing pension benefits, as you may be giving up any guaranteed benefits or protections.

n If you’ve registered for enhanced or fixed protection, you may lose this entitlement under certain circumstances. These include setting up a new pension plan like this one and/or paying contributions to any registered pension scheme that relates

n To build up a sum of money, in a tax-efficient way, that will be used to provide you with a pension income.

Its aim

Your commitment

Risks

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What’s a Group Personal Pension plan?It’s a plan that helps you save for retirement, in a tax-efficient way. It will be used to provide an income for your retirement, with the option to take part of your plan value as a tax-free cash sum.

It’s arranged for you by your employer, but you’ll have your own plan in your own name.

This isn’t a stakeholder pension plan. However, a stakeholder plan is generally available and may meet your needs at least as well as this plan.

How much can be paid into my plan each tax year?You, your employer, or someone else on your behalf, can pay contributions to your plan.

If you’re automatically enrolled, unless you opt out or choose to reduce the level of your contributions, there’s a minimum amount set by the government that must be paid into your plan. Your employer must contribute and may require you to contribute as well.There’s more information about this under the question ‘Are there any additional requirements if I’m automatically enrolled?’

If you’re automatically enrolled but still want to reduce contributions to below the minimum level, your employer doesn’t have to contribute.

You can receive tax relief on contributions up to 100% of your relevant UK earnings or, if higher, £3,600 in each tax year. This tax relief limit applies to all contributions made by you, or someone else other than your employer, to all pension plans that you have. The amount of tax relief depends on your individual circumstances.

If the total contributions paid to all your pension plans in any tax year is more than that year’s annual allowance, you may be subject to a tax charge on the amount paid over your annual allowance, unless you have any unused amounts that you can carry forward from the previous three years.

The annual allowance is the overall amount that can be paid into pension plans to benefit from tax relief. For the tax year 2013/14, the annual allowance is £50,000 reducing to £40,000 for the tax year 2014/15. If you think your total contributions will be more than the annual allowance, you should speak to a financial adviser.

Where are my contributions invested?We’ll invest any contributions made into your plan in investment funds.

Your employer (usually after advice from the financial adviser your employer appointed to give advice on the GPP) may have chosen a fund for your contributions to be invested in or may leave the decision to you. If neither you nor your employer make a decision, contributions will be invested in line with our Investment fund allocation procedure. You can view this at www.aegon.co.uk/usefulforms. You’ll also find our Investment fund cancellation procedure here.

If you’re automatically enrolled, a default investment strategy is in place when you join. You’ll find details of this in your Plan schedule.

You can change the funds you’re invested in. This is also known as switching. You can find full details about switching in and out of various funds in your policy conditions. Your policy conditions are included in your Welcome to your pension booklet. You’ll receive a copy of this booklet once your plan is set up, but if you’d like a copy now you can view this at www.aegon.co.uk/usefulforms, or you can contact us.

To help you decide on a fund (or funds), there’s more information about investments and the funds available at www.aegon.co.uk/funds/our-range-of-funds

If you’re transferring from your existing Aegon pension plan, we’ll assume your current choice of funds will stay the same, unless you tell us otherwise or you’re being automatically enrolled. If your existing investment fund isn’t available, we’ll invest any transfer in accordance with our Investment fund allocation procedure.

Questions and answers

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Are there any additional requirements if I’m automatically enrolled?If you’re automatically enrolled, and don’t opt out, minimum contribution rates apply.

Minimum contribution rates apply to the total of employer and employee contributions. As part of this total minimum, there’s also a separate minimum which employers must pay.

If your employer doesn’t pay the total minimum, by law, you must pay the difference. This is known as ‘the shortfall’ and is the difference between the total minimum and the employer minimum. Your contributions will be automatically increased to meet any shortfall, where this applies.

For example:The government sets the total minimum contribution rate at 5% of earnings and the employer minimum is set at 2% of earnings.

Scenario 1If the employer pays the 2% minimum, the employee has to pay the shortfall of 3%*

Scenario 2If the employer agrees to pay 4%, the employee has to pay the shortfall of 1%*

*The employee percentage would be reduced by the basic rate tax relief applying at the time.

If contributions to your plan are affected by the minimum contribution requirements set by the government now or in future, contribution rates to your plan will have to be increased (unless you opt out of the increase or your employer chooses another scheme as your qualifying scheme).

Your employer will tell you when or if contributions need to be increased to meet the minimum requirements set by the government for a qualifying scheme.

You can get more information about the minimum contribution requirements set by the government from www.aegon.co.uk/minimumcontributions

If you’re automatically enrolled and decide to stay in the GPP on the contribution rates set by your employer, you will be deemed to have accepted an agreement between you and Aegon that you will meet any shortfall in the total minimum payment requirements, as required by legislation.

Can you take payments from my plan to pay a financial adviser?Yes, for some GPPs we can arrange for payments of adviser charge to be taken from your plan to cover advisers’ fees.

If you’d like more information, please see our Adviser/consultancy charges terms and conditions.

Where can I find out about the product charges?Your illustration will show the charges applicable to, and the effect they may have on your plan.

Our annual management charge (AMC) covers the costs associated with managing your plan and investments. We take these charges for the duration of your plan.

We may vary the charges for the reasons set out in your policy conditions.

Can I change my mind and cancel my plan?Yes.

If you join the plan voluntarily, then decide to cancel, you’ll have 30 days from when you receive the cancellation form to complete it and return it to us.

If you’re automatically enrolled or choose to opt in, you’ll have one month to opt out. You’ll be notified of your opt-out period by your employer. If you’re an ‘entitled worker’ and decide to join, you still have the right to cancel your plan but you won’t receive a cancellation form. If you want to cancel your plan, you should contact us and let us know. You must do this within 30 days of receiving your policy documents.

You can find contact details at the back of this document. If you’ve paid any regular contributions into your plan, we’ll repay these.

For any single contributions, we’ll repay the amount you’ve paid. But, if your investment has fallen at the time we receive your cancellation form, we’ll repay this reduced amount.

If you decide to cancel, any transfer payment(s) will be paid back to your previous scheme. We may not be able to pay the full amount back to the transferring scheme if the value of your investment has fallen in the meantime. Please remember, the previous scheme may decide not to accept the transfer payment back into the scheme. If this happens, then you must choose another registered pension scheme to transfer the payment to.

Questions and answers

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If you decide to cancel within the cancellation period, any adviser charge, if this applies, will be reclaimed from the adviser and repaid to you. You may still be liable to pay your adviser any outstanding charges.

If you don’t cancel within the cancellation period your plan will continue.

Can I change my contributions or take a break?You can change regular contributions at any time, as long as you still meet the minimum contribution level. Please be aware, your employer’s contribution may depend on you maintaining a certain level of contribution.

You can stop or take a break from paying contributions at any time and leave your fund in the plan. Any contribution break is likely to reduce your future pension. You should speak to your employer to find out more if you’re thinking of taking a contribution break. Your policy conditions will give you more details. If you’re automatically enrolled and you decide to take a break from paying contributions, it means you’re opting out of the scheme and you may not be able to re-join at a time of your choosing.

If you’re automatically enrolled and you opt out or pay below the minimum required, your employer will automatically enrol you back into the plan at some stage, over the following three years, if you’re eligible.

Can I transfer my other pension plan(s) into this GPP plan?Yes, this GPP plan allows you to transfer the value of your other pension plan(s) into this one. However, this can only be done after this plan has been set up. This may not be in your best interests. See the Risks section on page three.

The minimum transfer payment(s) that we will accept into the plan is £2,500 for the first transfer payment and £499 for additional transfer payments.

What will happen to my transfer payment?We invest your transfer payment in your pension plan. We’ll assume your current choice of funds will stay the same, unless you tell us otherwise.

Can I transfer this plan to another personal pension plan?Yes, you can transfer this plan to a plan in another registered pension scheme at any time before you start taking pension benefits. There’s no charge for doing this.

The illustration in this pack gives examples of how much you could transfer to another plan, depending on when you transfer.

What about tax?Any contributions that you pay as personal contributions (up to the limit set by the Government as qualifying for tax relief) are paid net of basic rate income tax. We collect the tax relief from HM Revenue & Customs (HMRC) and add this to your plan as if paid at the same time as your contribution. Basic rate tax relief is currently 20%. So, if you’re a basic rate taxpayer, or not liable to tax, contributing £80 a month means £100 will automatically be invested in your plan – that’s an additional £20 at no extra cost to you.

There’s no tax charge for you on any contributions that your employer pays to your plan.

If your employer offers a salary sacrifice or salary exchange arrangement, contributions invested through that arrangement are treated by HMRC as employer contributions (though earnings after the salary sacrifice/exchange are used to calculate your income tax and National Insurance contributions). If your employer operates salary sacrifice/ exchange, your employer will give you details about this before arranging for you to start your plan.

If you’re in a higher tax band, you can claim the extra relief from HMRC on your yearly tax return or by approaching your tax office to adjust your tax code.

The value of any tax relief depends on your individual circumstances.

Growth in the value of the plan is free from capital gains tax, and certain types of dividends paid to the plan are free from income tax.

If the value of your pension savings when you take them is more than your available lifetime allowance, you may have to pay tax on the excess. In certain circumstances, you may have a higher lifetime allowance for pension savings under enhanced, primary, fixed or individual protection.

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The lifetime allowance is the limit on the value of tax-advantaged pension savings you can have under all registered pension schemes you’re a member of before tax charges apply.

The standard lifetime allowance for the tax year 2013/14 is £1.5 million reducing to £1.25 million for the tax year 2014/15. This limit doesn’t include any state retirement pension, state pension credit or dependant’s pension you may be entitled to.

If you move outside of the UK tax system (for example you work or live abroad) you should take local tax advice if you want to contribute to your plan. In particular, if you’re a US citizen or a US taxpayer and continue to contribute to this plan after you return to the US, you will be subject to US tax law.

This information is based on our understanding of current legislation, taxation law and HM Revenue & Customs practice, which may change.

When can I take my pension benefits?You can take your pension benefits from your plan at any time between the ages of 55 and 75 (including while you’re still working).

You may be able to take your pension benefits earlier than age 55 if you’re in ill health or have a protected pension age. If you think you have a protected pension age, speak to a financial adviser for more information.

What choices will I have when I want to take my pension benefits?We’ll write to you before you take your pension benefits and give you details of all your options, including:n using all your plan value to provide a pension either with

us or another pension provider (which would be taxable as pension income under PAYE)

n taking part of the plan value as tax-free cash (usually up to 25%), and taking a smaller pension income

n transferring your fund to a more flexible retirement plan and taking income withdrawals, known as drawdown pension. There are limits set down by the government on how much income you can take. You may also be able to take part of your fund as tax-free cash (usually up to 25%)

If you don’t want to take your pension benefits before the age of 75, you can transfer the value of your plan to another plan, with us or another provider, and choose to remain invested. If, by the day before your 75th birthday, you haven’t told us how you’d like to take your pension benefits from your plan, we’ll assume you want to take a pension income with us.

If you want to receive tax-free cash under your plan, you must apply to take it before you reach age 75 or you’ll lose the right to take it.

What might I get when I want to take my pension benefits?The illustration included in this pack shows examples of what you may receive.

However, your final plan value, which is used to provide a pension income may depend on the following:n how much is paid inn how long contributions are paid to your plann investment performance, which may go down as well

as up n plan chargesn if you’re paying an adviser charge from your plan.

Will my contributions be paid if I fall ill?If your employer offers waiver of contribution (in conjunction with your pension plan), this could cover the contributions to your pension plan if you became ill and couldn’t contribute to your plan.

Even if your employer doesn’t offer this cover, you can still apply for it. The minimum age you can apply for cover is 18 and the maximum is 58 (with the benefit stopping at age 60). Please contact us in writing or by phone and we’ll send a form to you.

The cost of this cover can vary depending on your occupation and health. We’ll let you know the cost when you apply.

Please note that any waiver cover will stop:n when you reach age 60, even if your scheme retirement

date is over age 60n if you stop paying into your pension plann if you cancel your cover

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What happens to this plan if I die?We’ll use the value of your pension plan to provide death benefits to your dependants or beneficiaries. We’ll normally pay this as a cash lump sum.

We’ll decide who to pay the lump sum to, and we take into account your circumstances when you die and anyone you’ve stated you want the money to go to.

The lump sum death benefit paid from your pension fund is normally tax-free, and free of Inheritance Tax. It will be tested against your available lifetime allowance and the person receiving this benefit will be taxed at 55% on any amount over your allowance.

You can choose to have a pension paid to your dependants instead of a lump sum. This wouldn’t be tested against your available lifetime allowance and there would be no tax charge (although the pension income would be taxable under PAYE).

We’ll stop facilitating the payment of any adviser charge, if this applies, from the date we’re notified of your death.

In addition, for plans set up after 1 January 2013, if you die as a direct result of an accident before your plan has been running for five years, we’ll pay an additional lump sum equal to 10% of the total contributions paid into your plan. Please refer to your policy conditions for full details, including the exclusions that apply.

To help us identify who you’d like to benefit from your plan if you die before you take pension benefits, please complete a Death benefit nomination form which you can find at www.aegon.co.uk/usefulforms.

How will I know how my plan is doing?Every year we’ll send you a statement showing how your plan is performing, how much your plan is worth, how much has been paid in and your estimated pension at your retirement age.

You can also access up-to-the-minute information about your plan online, whenever you want it, through our secure online services. We’ll send you details on how to register once your plan has been set up.

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How to complainWe hope you never have to complain, but if you do, the first step is to contact us. If you’re not satisfied with our response, you can then raise the issue by contacting the following organisation:

The Financial Ombudsman Service:Phone: 0845 080 1800Email: complaint.info@financial-ombudsman.org.ukWrite to:The Financial Ombudsman ServiceSouth Quay Plaza183 Marsh WallLondonE14 9SRwww.financial-ombudsman.org.uk/

Referring the matter to this ombudsman service won’t affect your right to take legal action later on.

If you’d like a copy of our complaints procedure, please ask us, or you can download it from the ‘Contact us’ section of our website at www.aegon.co.uk

Time limitsWe’ll tell you about any time limits that may apply and that aren’t covered here or in the illustration, for example underwriting decisions or requirements that may have time limits.

You must let us know of any changes to your circumstances or any other details you’ve given us.

Client categorisationWe categorise all of our clients as ‘Retail clients’ under the Financial Conduct Authority rules for all services and transactions. This helps us to make sure that you receive appropriate disclosure documents from us and that you’re made aware of everything you need to know in a timely fashion.

Terms and conditionsThis key features only gives you a summary of the main points of our Group Personal Pension plan. It doesn’t include all the definitions, exclusions, terms and conditions.

You can find full details in the policy conditions section of the Welcome to your pension booklet and the Adviser/consultancy charges terms and conditions. If you need a copy of these, you can view them at www.aegon.co.uk/usefulforms, or you can contact us. You’ll find our contact details on the last page of this document.

We have the right to change some of the terms and conditions. If this happens, we’ll write to you and explain the changes.

CommunicationOur contract with you is in English and all future communication about it will be in English.

LawYou must live in the UK to get a new GPP. Your plan will be set up and governed by the law of the part of the UK where you live when your GPP starts.

CompensationYour plan with us is covered by the Financial Services Compensation Scheme. You may be entitled to compensation from the scheme if we can’t meet our obligations (for example if we were to become insolvent or unable to meet the claims against us). This depends on the type of business and the circumstances of the claim. Insurance business of this type is generally covered for 90% of the value of the whole claim, without limit.

You can get more information about compensation arrangements from the Financial Services Compensation Scheme by calling 0207 741 4100 or visiting www.fscs.org.uk

Authority registerAegon is a brand name of Scottish Equitable plc. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Financial Services Register number 165548.

If you’d like a large print, Braille or audio CD version, please call 08456 10 00 88.

Other information

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How to contact us

You may have specific contact details, depending on how your scheme is set up. You can find these in your joining pack, or if you’ve been automatically enrolled, it will be in the details you get about the plan. Otherwise, you can:

Write to us at:

AegonEdinburgh ParkEdinburghEH12 9SE

Phone us on:

08456 10 00 88

Fax us on:

08702 42 67 88

Email us at:

enquiries@aegon.co.uk

Visit our website:

www.aegon.co.uk

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@aegonuk

Aegon is a brand name of Scottish Equitable plc. Scottish Equitable plc, registered office: Edinburgh Park, Edinburgh EH12 9SE. Registered in Scotland (No. 144517). Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Financial Services Register number 165548. An Aegon company. www.aegon.co.uk © 2014 Aegon UK plc

C 285296 WPS 00024275 02/14

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