You can apply to exchange all your ill health benefits for a one-off lump sum payment if you’re diagnosed with a terminal illness and do not expect to live longer than 12 months.
If you're over your normal pension age (NPA), there's other criteria which will be checked to make sure this is possible.
This may be taxed. Contact HM Revenue & Customs (HMRC) if you have a query about tax.
To be able to exchange your pension benefits you must have:
- membership in the Scheme on or after 6 March 1995
- some of your HMRC personal lifetime allowance (LTA) remaining
- not already claimed your pension
If you choose to exchange your benefits, your dependants will still get any benefits they’re entitled to in full.
If your condition improves or you return to work, you do not need to repay this lump sum. There will be no abatement action taken.
Read more information about terminal ill health on our website.
Under NPA
You must first apply for consideration of entitlement to ill health benefits on either a:
- AW33E form if you're an active member - your employer will provide this
- AW240 form if you're a deferred member
- AW240(PC) form if you’re a pension credit member
Once you’re accepted, you must complete and send the AW341 form with an:
- AW8 if you're an active member
- AW8P if you're a deferred member
- AW8PC form if you're a pension credit member
Over NPA
You cannot apply for ill health retirement benefits.
You have the option to exchange your retirement benefits for a one-off lump sum payment.
Complete and send an AW341a form with an:
- AW8 if you're an active member
- AW8P if you're a deferred member
- AW8PC form if you're a pension credit member
Use the reason for retirement as ‘commuted ill-health’.
Fast track application
If you’ve been given a terminal diagnosis with less than 12 months to live, you can ask for your application to be dealt with urgently.
If you’re under NPA, you can apply for consideration and apply for your pension at the same time.
In NHS employment
Your employer must email a copy of all forms to stakeholderengagement@nhsbsa.nhs.uk.
Not in NHS employment
You must send a copy of all forms to medoperations@nhsbsa.nhs.uk.