The main benefit from the BP Pension Scheme is a pension for life.
Your BP pension is based on 1/60th of your Final Salary for each year you were an employee member of the Scheme (known as [[Dictionary(BP):pensionable service]]). The formula used to calculate your pension is:
(Final Salary ÷ 60) x Pensionable Service (in years and days)
When you were an employee member of the Scheme, you may have taken the opportunity to increase your pension by:
- joining one of the Scheme's five 'contributory options' (increasing the annual 'build-up rate' from 1/60 to 1/54, 1/51, 1/45, 1/40 or 1/35, depending on your own contributions); and/or
- paying Additional Voluntary Contributions (AVCs).
Any such additional contributions will be reflected in your pension now being paid, unless you were able to take them as tax-free cash.
Your BP pension is payable monthly in advance, with income tax deducted in the same way as from salary. You can check your monthly pension payments in 'My benefits'.
what other benefits does the Scheme provide?
The BP Pension Scheme provides other benefits, including financial protection for your family - these are covered in the who will receive benefits if I die? section.
Your pension is guaranteed to increase annually in line with inflation, up to a maximum of 5% a year. Inflation is measured by the rise in the Retail Prices Index each December, and any increases due are paid from the following May. If you were a member of the Fund before April 1997, your pension will include a [[Dictionary(BP):Guaranteed Minimum Pension (GMP)]] increase. Responsibility for this increase is shared between the Fund and the State.
BP Pensions & Benefits will write to you in April each year to tell you how much the increase will be and give you a forecast of your payments for the rest of the tax year. If your net monthly pension payment changes by £10 or more, the Team will send you a new forecast.
Your online pension payment forecast will automatically reflect any increase.
Spouses', civil partners' and dependants' pensions increase in the same way.
Click here if you would like to find out how the Trustee decides what annual increase will be awarded.
You can find out more about pension increases in the explanatory booklet.
If you are not already receiving your Basic State Pension, you can get a State retirement pension forecast (available by calling 0845 3000 168 or online at https://www.gov.uk/state-pension-statement).