Public Sector & Occupational Pensions UKArmed Forces Pension Guide UK — Military Pension Schemes Explained
How the Armed Forces Pension Scheme works, the different scheme types, how much you'll get, early departure payments, and pension planning for military personnel.
The Armed Forces Pension Scheme is one of the most generous pension arrangements in the UK — it’s non-contributory, provides a guaranteed income in retirement, and includes valuable early departure benefits. This guide explains how it works across all three scheme types.
The Three Schemes
| Scheme | Who it covers | Type |
|---|
| AFPS 75 | Those who joined before 6 April 2005 | Final salary |
| AFPS 05 | Those who joined 6 April 2005 – 31 March 2015 | Final salary |
| AFPS 15 | All serving personnel from 1 April 2015 | Career average (CARE) |
Most currently serving personnel are in AFPS 15. If you joined before 2015, you may have benefits in earlier schemes too — these are protected.
AFPS 15 — The Current Scheme
| Feature | Detail |
|---|
| Type | Career Average Revalued Earnings (CARE) |
| Accrual rate | 1/47th of pensionable earnings for each year |
| Revaluation | Linked to Average Weekly Earnings (usually higher than CPI) |
| Normal pension age | State Pension age (currently 67, rising to 68) |
| Lump sum | Automatic 3 × annual pension (tax-free) |
| Employee contributions | None — non-contributory |
| Death in service | Lump sum of 4 × annual pensionable pay |
| Dependant’s pension | Partner receives pension for life |
How the Pension Builds Up
Each year, 1/47th of your pensionable pay is added to your pension pot. Previous years’ accruals are increased annually.
| Year | Salary | Pension accrued that year | Cumulative pension (simplified) |
|---|
| 1 | £25,000 | £532 | £532 |
| 5 | £30,000 | £638 | ~£3,200 |
| 10 | £35,000 | £745 | ~£7,200 |
| 20 | £42,000 | £894 | ~£17,500 |
Figures are simplified — actual amounts include annual revaluation, which increases earlier years’ accruals.
Early Departure Payment (EDP)
If you serve long enough, you don’t have to wait until State Pension age:
| Criterion | Requirement |
|---|
| Minimum age | 40 |
| Minimum service | 20 years (officers) or 18 years (other ranks) |
What You Get
| Benefit | Amount |
|---|
| EDP income | Roughly 50% of your deferred AFPS 15 pension (increasing to ~75% at SPA) |
| EDP lump sum | ~2.25 × your EDP income (tax-free) |
| Full pension | Starts at State Pension age |
Example: Sergeant Leaving at Age 40 After 20 Years
| Benefit | Approximate amount |
|---|
| Deferred annual pension (at SPA) | ~£17,000/year |
| EDP income (from age 40) | ~£8,500/year |
| EDP lump sum | ~£19,000 |
| Full pension (from SPA) | ~£17,000/year |
| Full lump sum (at SPA) | ~£51,000 |
AFPS 05
| Feature | Detail |
|---|
| Type | Final salary |
| Accrual rate | 1/70th of final pensionable pay per year |
| Pension age | 65 |
| Lump sum | 3 × annual pension (automatic) |
| Immediate Pension | After 18 years (other ranks) or 20 years (officers) from age 40 |
| Employee contributions | None |
AFPS 75
| Feature | Detail |
|---|
| Type | Final salary |
| Accrual rate | 1/69th (officers) or 1/69th (other ranks, varies) |
| Immediate Pension | After 16 years (officers) or 22 years (other ranks) |
| Resettlement grant | Tax-free lump sum on leaving |
| Lump sum | 3 × annual pension |
| Employee contributions | None |
Comparing the Three Schemes
| Feature | AFPS 75 | AFPS 05 | AFPS 15 |
|---|
| Accrual rate | 1/69th | 1/70th | 1/47th |
| Basis | Final salary | Final salary | Career average |
| Pension age | 55/60 (varies) | 65 | State Pension age |
| Immediate Pension | Yes (16-22 years) | Yes (18-20 years) | No — EDP instead |
| Lump sum | 3× pension | 3× pension | 3× pension |
| Contributions | None | None | None |
| Revaluation | N/A (final salary) | N/A (final salary) | Average Weekly Earnings |
Additional Benefits
| Benefit | Detail |
|---|
| Death in service lump sum | 4× pensionable pay (AFPS 15) |
| Dependant’s pension | Spouse/civil partner receives a pension |
| Children’s pension | Eligible children receive a pension until age 23 (in full-time education) |
| Ill-health pension | If medically discharged, enhanced pension based on service and tier |
| Attributable benefits | Enhanced benefits if illness/injury is caused by military service |
| Resettlement support | Career Transition Partnership (CTP) for employment support |
Tax on Military Pensions
| Detail | Treatment |
|---|
| Pension income | Taxed as income (PAYE) |
| Tax-free lump sum | Not taxed (up to 25% of pension value) |
| EDP lump sum | Tax-free |
| Annual Allowance | Military pensions count towards the £60,000 annual pension allowance |
| Lifetime Allowance | Abolished from April 2024 — no longer applies |
Pension Planning for Military Personnel
| Action | When |
|---|
| Check your pension forecast | Use the Armed Forces Pension Calculator on GOV.UK |
| Understand your benefits | Request an annual benefit statement from Veterans UK |
| Plan for the gap | Between leaving the military and State Pension age, EDP may not cover all your expenses |
| Consider additional savings | ISAs, SIPPs, or other savings to supplement your pension |
| Resettlement | Use CTP for transition support and employment |
| Review dependant nominations | Ensure your pension nomination form is up to date |
| Take financial advice | Forces MoneyForce and the MoneyHelper Armed Forces page offer free guidance |
| Organisation | What they do |
|---|
| Veterans UK | Manages Armed Forces pension payments |
| Forces Pension Society | Independent pension guidance and advocacy |
| MoneyHelper | Free pension guidance including Armed Forces section |
| SSAFA | Financial assistance and advice for Forces families |
| Royal British Legion | Financial support and advice |
Summary
| Feature | AFPS 15 |
|---|
| Contributions | None — non-contributory |
| Accrual | 1/47th per year (career average) |
| Pension age | State Pension age |
| Lump sum | 3× pension (tax-free) |
| EDP | Available from age 40 with 18-20 years’ service |
| Death in service | 4× salary |
| Dependant’s pension | Yes |
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