Starting work after any period of 'unemployment' (whether voluntary or not) can be daunting. Remember you cannot work as a nurse if your NMC registration has expired. Read more on NMC registration plus working with ill health on the NMC's website.
Any earnings you have from employment will be taxable, this includes your pension if you receive one.
You can return to work in the NHS following early or ill health retirement but if you are receiving an NHS pension you will need to bear in mind the income restrictions for future NHS employment. Your combined income of new NHS earnings plus NHS pension cannot equal more than the NHS earnings you had before you returned. If it is, your pension will be capped (this is called abatement). In addition, you must have a break in service of at least 24 hours and work only 16 hours per week or less in the first month after retirement. Whether you will be able to re-join the NHS pension scheme will depend on whether you are already receiving pension benefits and your age.
If you are not receiving an NHS pension, but have preserved contributions, seek advice about your pension options from an independent financial adviser.
If your pension was awarded on or after 1 April 2008 your pension may be affected depending on what tier pension you were awarded and the nature of your future employment.
Tier 1 pension – this has been granted on the basis that you are unable to undertake your current job, but are able to undertake future work. The only restriction is therefore a possible abatement of pension if you return to NHS employment. If your NHS pension plus your new NHS earnings exceeds your NHS earnings before you retired, the ‘unearned’ portion of your pension will be abated. Unearned means any part of the pension that would be paid in addition to that over and above Voluntary Early Retirement arrangements (where the pension is reduced by actuarial factors provided by the Government Actuaries Department).
Tier 2 pension – this has been granted on the basis that you are unable to undertake regular employment so there are a number of restrictions to be aware of. These differ depending on whether your new employment is in the NHS or not. All Tier 2 pensioners are subject to an annual earnings declaration until normal retirement age.
If you start a new job in the NHS you will remain entitled to your Tier 2 pension for 12 months after the start of new NHS employment so long as you don’t earn over the current National Insurance Lower Earnings Limit (LEL). If earnings exceed the LEL in the first 12 months your pension will be reduced to its Tier 1 level as soon as earnings exceed that amount. The start of the 12 month period is the first day you start work in the NHS after your retirement. For members working on a nurse bank, the start of the 12 month period is the first date of actual work, not the day you register with the bank.
Should your pension be reduced to its Tier 1 level, you have a one-off opportunity to regain the Tier 2 pension if, within 12 months of starting employment, you have to cease work due to ill health. You would need to apply to the pensions department and have medical evidence to confirm that continuing employment is not possible due to ill health. You would not be able to rejoin the NHS pension scheme during this 12 month window otherwise your right to regain the Tier 2 pension will be lost.
If you start a new job outside the NHS you will be able to earn up to the NI LEL each tax year and remain on your Tier 2 pension. If LEL is ever exceeded, your pension will be reduced to its Tier 1 level. You will also have a one off opportunity to regain Tier 2 pension if continuing employment not possible due to ill health (see above).
Be aware of the requirements of the Equality Act 2010 as you may need adjustments made to the new job.
If you are self-employed and worried about the effects of your income on your ill health retirement pension, seek tailored advice. This could be from an accountant, an independent financial adviser (this may include using the services of Lighthouse Financial Advice through RCN Xtra), NHS Pensions or The Pensions Advisory Service.