New NHS pension

Investment Questions and Chats General Investment
#1

Salaam,

Is the new NHS pension shariah compliant?

Jzk

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#2

Wasalam

May Allah bless you.
What is the new scheme? Please kindly send some more details.

Kind regards

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#3

Here is a PDF of a guide for the pension scheme, the scheme I am speaking of is the 2015 scheme also known as the CARE scheme.

Jzk

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#4

Assalaamu alaykum,

It is permissible to join the CARE scheme and receive pension income from the CARE scheme.

Allah knows best

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#5

JzkAllah…in terms of zakat on this specific nhs pension is it required? I note your discussion on another thread about zakat on pensions and to check whether it is a defined benefit vs defined contribution scheme…

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#6

Assalaamu alaykum,

The NHS pension is a type of defined benefit scheme. Zakat is not payable on this type of pension. When you withdraw, the funds will be treated as cash assets and the corresponding Zakat Principles for cash will apply.

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#7

JzkAllah. When you say withdraw do you mean when the pension starts to be paid out to you? For e.g. if you left the nhs but still working so didn’t get the pay out yet till later on in life would you still pay it on the amount that was locked in the pension fund despite not actively receiving anything from it at that point?

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#8

Yes, only when you drawdown and start getting paid your pension as income,that’s when you start paying Zakat on it.

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#9

Brill. JzkAllah so when the fund is locked to you then you don’t pay (when you are paying into it and when you have stopped paying into it if you moved jobs).

When you retire and they start paying out do you pay zakat on the full amount in the pot? I don’t know the exact details sorry but whatever amount they give you let’s say per week or month so you’re only maalik of that weekly or monthly amount they give you but the rest you can’t really access till they pay you bit by bit unless of course they paid you as a lump sum…

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#10

That’s right. Zakat is only due on the amount you have left in your account on your Zakat anniversary, not the entire pot value.

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#11

JzkAllah for clarifying all that. May Allah reward you and the team here for all your work.

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