Thinking of retiring early from the NHS pension?

Taking early retirement from the NHS Pension Scheme, officially called Actuarially Reduced Early Retirement (ARER), means you can start drawing your pension before your normal pension age (NPA), but with a catch: your pension will be reduced because it’s being paid out for a longer period.

Here’s how it works:

Minimum pension age (MPA)

Your MPA depends on which section of the NHS Pension Scheme you’re in:

1995 Section:

If you were an active member between 31 March 2000 and 5 April 2006, you can retire from age 50.

If you joined after 6 April 2006, your MPA is 55. This is increasing to 57 from 6 April 2028.

2008 Section:
MPA is 55, increasing to 57 from 6 April 2028.

2015 Scheme:
MPA is 55, increasing to 57 from 6 April 2028.

How much is the reduction?

The earlier you retire, the bigger the reduction. Here’s an example from the 1995 Section:

So if you retire at 55 instead of 60, you’d get about 81.2% of your pension and 91.9% of your lump sum.

Other key rules

Cost-of-living increases (inflation adjustments) only start once you reach age 55. If you retire earlier, you’ll get a backdated increase when you turn 55.

If you retire early on health grounds, you will receive pension increases even if this is before age 55, and you won’t need to wait until 55 to benefit from annual revaluation.

Your dependants’ benefits (like a spouse’s pension) are not reduced, even if you retire early.

You must apply using the AW8 form.

Special class and mental health officer status

If you have Special Class (SC) or Mental Health Officer (MHO) status and retire before age 55, your benefits are reduced as if your NPA was 60, not 55. That means a slightly smaller reduction compared to others.

If you need any advice or guidance, please get in touch with your usual Larking Gowen contact or email enquiry@larking-gowen.co.uk.

Jamie Butcher