Teachers’ Pension Phased Retirement Calculator

Phased retirement — the five simple rules

  • Age: You usually need to be 55+ (this rises to 57 from April 2028).
  • Pay cut: Reduce your pensionable pay by about 20% and keep it lower for 12 months.
  • How much: You can draw up to 75% of your pension in total, spread over one or more phases. The rest stays saved and keeps growing.
  • Starting early: If you take a slice before your Normal Pension Age, the yearly amount is smaller because the scheme pays it for more years. (Like sharing the same pie into more slices.)
  • Keep building: Any CARE pension you haven’t taken keeps growing each year. Older Final Salary benefits are protected and may still link to your final salary, but don’t build up in the same way.

Your inputs

Use the “annual pension” from your latest TPS statement.
%
Many teachers try 30–50% for the first phase. Across all phases you can usually draw up to 75% of your benefits.
After reducing hours/pay (aim for ≥20% reduction).
Only needed if you typed your new salary. If you used FTE + %, we use that instead.
Simple mode does not include early-payment reductions. Turn this on for an estimate.
We’ll check the 20% rule after you calculate.

Phased retirement — FAQs

It lets you take part of your pension while you reduce your hours/pay. You get a steady mix of reduced salary + pension slice now, and you keep the rest of your pension for full retirement later.

You can usually start from age 55. From April 2028, the minimum rises to 57. (Your Normal Pension Age is separate and is when a pension is normally paid in full without early-payment reductions.)

  • Final Salary only: up to two before full retirement.
  • CARE only: up to three in total, but only two can be taken before age 60.
  • Benefits in both sections: you can take different proportions from Final Salary and CARE.

No break in service is needed. You can start your phased arrangement as soon as it’s agreed with your employer and they certify the application.

  • You can also apply within 3 months after starting a new role that meets the criteria.
  • If you’ve left employment, you can still apply if you return to a TPS employer within 6 months.

If your pensionable pay no longer meets the ≥20% reduction during the initial 12 months:

  • Your phased arrangement can be invalidated and benefits suspended.
  • There may be an HMRC unauthorised payment charge (40%) on any lump sum paid at the point you phased.

Speak to your employer/payroll before any changes to hours or responsibility during this period.

When you phase, you become a dual capacity member (pensioner and active). If you die in service:

  • Any retirement lump sum taken at phased is deducted from the in-service death grant.
  • If you die within five years of phasing (or before receiving five years’ pension), a supplementary death grant may be payable (five times your pension at death, less pension already paid).

See Teachers’ Pensions guidance for full conditions and how nominations work.

It’s part of the scheme’s eligibility check to show you’ve genuinely moved to lower pensionable earnings. If your pay jumps back up within the first 12 months, phased payments can be stopped.

Across all your phased events combined, you can usually draw up to 75% of your benefits. Many teachers start with 30–50% for the first phase and review later.

Imagine a pie you eat over time. If you start earlier, the scheme expects to pay you for more years, so each year’s slice is **smaller**. Start at your Normal Pension Age and the yearly amount is bigger, because it’s paid for fewer years.

Older Final Salary (1/80ths) can pay an automatic lump sum on the portion you take. CARE and 1/60ths don’t have automatic cash, but you can often swap some yearly pension for cash (subject to tax-free limits).

No — the reduction happens once, when you first take the slice.

The scheme applies an “early payment” cut because you are being paid for more years than someone who waits until their Normal Pension Age. After that one-time cut, the slice is fixed and usually rises each April in line with CPI inflation.

Example:

  • Normal Pension Age = 65
  • At 57 you take 40% of a £10,000 pension = £4,000 slice
  • 8 years early = cut of ~32–40% → £2,700/year instead of £4,000
  • You now get £2,700 every year for life, uprated with CPI each year
  • At 65 the remaining 60% comes into payment at its full value

So the slice doesn’t shrink year by year — it’s just set lower at the start, then grows with indexation.

Salary is taxed with PAYE (and NI); pension is taxed as income (no NI). Our simple view shows gross figures; an advanced view can estimate take-home using your tax code/region.