HMRC has published guidance for pension administrators on the end of “contracting-out” for defined benefit pension schemes, following the introduction of the new state pension, and has warned it will not track contracted-out rights or issue statements to pension schemes.

The guidance highlights how the ending of contracting-out will affect pension entitlements, and states that administrators will need to check members’ Guaranteed Minimum Pension (GMP).

Under the new rules, administrators are required to make sure that members’ entitlements resulting from contracted-out employment are protected. They also have to provide a GMP to members for contracted-out service between 6 April 1978 and 5 April 1997 (a GMP is payable at age 60 for a women and 65 for a man).

In order to calculate the GMP, HMRC is providing an online service which can be accessed via a government gateway account for the pension scheme online service.

HMRC’s guidance can be found here.