The Penguin Random House Pension Scheme - e-community · 2016-03-23 · its employees. That is why all employees have the opportunity to join the Penguin Random House Pension Scheme

The Penguin Random HousePension Scheme

Defined Contribution Section

MEMBERSHIP GUIDE

The Penguin Random House Pension Scheme MEMBERSHIP GUIDE

Contentspage

Overview 1-2

Joining the Scheme 3

Contributions 4-5

Your investment fund choices 6

Retirement 7-8

Benefits on Death 9

Leaving the Scheme 10-11

General Information 12-14

Useful addresses 15-16

Pension terms explained 17-18


1The Penguin Random House Pension Scheme MEMBERSHIP GUIDE

OverviewPenguin Random House understands the importance of providing for the future of all

its employees. That is why all employees have the opportunity to join the Penguin

Random House Pension Scheme Defined Contribution Section (“the Scheme”).

If you join the Scheme contributions are made by you and the Company into a pension

account in your own name. This pension account will be invested until you decide to retire.

The amount of benefit you are able to purchase with your pension account at the point

of retirement will depend upon the level of contributions made, the performance of the

funds in which you decide to invest contributions and the cost of securing your

retirement income when you retire.

If you join the Scheme the Company’s contribution will be up to 10% of your pensionable

salary, depending upon the level of contribution you decide to make personally.

As a member of the Scheme you are required to make contributions of at least 3% of

your pensionable salary. You are able to contribute either 3%, 4% or 5% of your pen-

sionable salary with the Company contributing twice what you put in.

To join the Scheme you must log onto the Penguin Random House Benefits Portal and

select the ‘Benefits’ button.

If you decide not to join the Scheme you will not qualify for:

- Company contributions

- Additional death-in-service cover

- A tax-efficient method of saving.

The Scheme is managed and monitored by a group of Trustees, some of whom are

appointed by the Company and others who are directly elected by Scheme members.

The Trustee body endeavours to provide the means by which responsible governance

and risk management can be achieved, consistent with our values and in line with best

practice.

Throughout this booklet we try to avoid using complicated jargon. Where we do use

technical terms these are explained within the ‘Pension terms explained’ section on

page 17.

The Penguin Random House Pension Scheme MEMBERSHIP GUIDE2

You join the Scheme by logging onto the Penguin Random HouseBenefits Portal and selecting the Benefits button

You decide how much to pay in:3%, 4% or 5% of pensionable

salary (see pages 4-5)

The Company’s contribution will be twicewhat you pay up to a maximum of 10% of

pensionable salary (see pages 4-5)

You decide how to invest your pension account byregistering for the Friends Life online service and selectingyour investment fund(s) (see page 6). Unless you make

your own choices your contributions will beinvested within the Scheme’s default fund.

See the separate ‘Investing for Retirement’ guidefor information about the default fund

Contributions and investment returns build up within your pension account. Set out below are theoptions available when you retire, should you leave the Scheme before reaching your retirement

date or should you die in service.

When you retireYou can choose a number of

benefits including:• A pension for life

• A combination of pensionand lump sum

• A lump sum, one quarterof which is tax free• Inflation-related

increases • Benefits for your

dependantsSee pages 7-8

If you leave the SchemeIf you leave the Company or opt out

of the Scheme, then your owncontributions and those of the

Company will stop.The following options will be available

with your pension account:

If you leave the Scheme within onemonth of joining it (two years if youjoined before 1 October 2015) you canelect either to receive a refund of the

contributions you have made(excluding any made via salary

sacrifice) or transfer your pensionaccount into another pension scheme.

If you have been a Scheme memberfor at least one month (two years ifyou joined before 1 October 2015) you

can leave your pension accountinvested in the Scheme or elect for itto be transferred into an alternative

pension scheme.See pages 10- 11

If you die in serviceThe Scheme will pay

A lump sum of four timesyour salary* to your

beneficiaries.

A pension to your spouse or,if you are not

married, to a financialdependant.

A return of the contributionsyou made into the Scheme(including those made via

salary sacrifice)plus interest.

Each of these benefits ispayable at the discretion of

the Trustees.See page 9

*Unless you have selected adifferent multiple via the

Company’s flexible benefitsarrangement

The diagram below gives a brief summary of how the Scheme works and of the options available to you at

different stages of your life.

Joining the SchemeEligibility

You are eligible to join the Scheme on the day you join the Company.

How do I join?

To join the Scheme you will need to log onto the Penguin Random House BenefitsPortal, select the Benefits button and choose Penguin Random House Money PurchaseScheme. Your membership will then begin from the first day of the following month.

During the application process you will need to select the level of contribution you wishto pay. When you join you will have the opportunity to choose your selected retirementage. You will also have the opportunity to select the funds you wish to invest in byregistering for the online service of the Scheme administrators, Friends Life.

What if I do not join the Scheme immediately?

If you decline to join the Scheme when first eligible, you can subsequently apply to joinat a later date by logging onto the Benefits Portal. You may be required to providemedical evidence acceptable to the insurance companies that insure the deathbenefits.

Opting not to join the Scheme

Scheme membership is not compulsory and, if you do not want to be a member, you donot have to join.

If you do not join the Scheme, and if you are eligible to be auto-enrolled into a qualifyingpension scheme, you will be enrolled into the company’s auto enrolment scheme, NEST.Further information will be provided if this applies to you.

If you do not join the Scheme you will still be covered by the lump sum death-in-servicebenefit but you will not be covered for the death in service pension (see page 9).


ContributionsContributions

You can choose how much you wish to contribute to the Scheme and this will determinehow much the Company will pay on your behalf. The contribution rates below will beapplied to your Pensionable Salary.

To join the Scheme you are required to make a basic contribution of at least 3% of yourPensionable Salary. You may contribute either 3%, 4% or 5% of your Pensionable Salarywith the Company contributing twice what you pay, up to a maximum of 10% ofPensionable Salary, as follows:

Contribution option You pay The Company pays Total contributionOption A 3% 6% 9%Option B 4% 8% 12%Option C 5% 10% 15%

In addition to this, the Company pays for all of the costs of the life cover andDependants’ death-in-service pensions as well as the costs of administering the Scheme.

Contributions you make into the Scheme above 5% do not attract any furthercontributions from the Company and are called Additional Voluntary Contributions (AVCs).

Salary Sacrifice

Unless you instruct us otherwise your basic contributions will be paid into the Scheme bySalary Sacrifice.

Salary Sacrifice is an agreement between you and the Company to vary the salary youreceive under your contract of employment. You ‘give up’ the percentage of your salarythat you have selected to make as a contribution into the Scheme and in return theCompany pays an amount equal to the amount ‘given up’ directly into the Scheme,alongside the Company’s contribution. By using this mechanism neither you nor theCompany will pay National Insurance Contributions (NICs) on the contribution youhave elected to make into the Scheme.

Please note that although your selected basic contribution will be deducted via SalarySacrifice any AVCs you decide to make will not be subject to Salary Sacrifice.

Because making basic contributions via Salary Sacrifice helps you save NICs, weassume that all Scheme members elect to make contributions via Salary Sacrifice.However you may decide at any time to opt out of the Salary Sacrifice arrangement.To do this you should contact the Human Resources Department

Changing Contribution Rates

You can increase or decrease your basic contribution rate as often as you want by loggingonto the Benefits Portal during the monthly benefits window which runs from the 1st to the15th of each month. The new contribution rate that you select, and that of the Company, willthen change from the beginning of the following month.


How much will it cost me?

Subject to limits, relief from income tax is given on the contribution you make becauseit is deducted from your pay before income tax is deducted. Additionally, unless you optout of making contributions via Salary Sacrifice, you will avoid paying NICs on your basiccontribution. This considerably reduces the net cost to you of making your pensioncontributions.

The following example illustrates how pension contributions under the Scheme areworked out and illustrates the tax advantages of making them. It is based upon amember with a Pensionable Salary of £30,000 pa.

Your Contribution 3% 4% 5%

Monthly Gross Payment £ 75.00 £100.00 £125.00

Less Tax Relief at 20% £ 15.00 £20.00 £25.00

Net Cost to you £ 60.00 £80.00 £100.00

The Company will pay £150.00 £200.00 £250.00

The total amount credited to your

pension account would be £225.00 £300.00 £375.00

Monthly NIC saving from Salary Sacrifice £9.00 £12.00 £15.00

Can I pay more?

You may increase the retirement benefits provided by the Scheme by paying AdditionalVoluntary Contributions (AVCs). The AVCs, together with your basic contributions andthose of the company, will be paid into your pension account and invested inaccordance with your instructions.

Benefits arising from AVCs are often taken at the same time as your other benefits fromthe Scheme but other options may be available to you. Please ask the PensionsManager for further details.

You should note that any AVCs you decide to make will not be subject to Salary Sacrifice.

The level of contribution you can pay to all your pension arrangements and gain taxrelief, including any AVCs, is subject to the Annual Allowance. Please contact thePensions Manager for details of the current restrictions.


Your investment fund choicesThe Scheme offers a number of fund choices in which your and the Company’scontributions can be invested.

Choosing where to invest your pension account and regularly reviewing that decision isone of the most important actions you must take as a member of the Scheme.We recommend that you spend as much time as possible considering where to investcontributions to the Scheme as this is critical to the ultimate size of your pensionaccount at retirement.

The Investing for Retirement guide that accompanies this booklet sets out details of thefund choices available to you. It also sets out a three-step process for you to follow tohelp you choose your investment fund(s). This guide, together with links to the fund factsheets for each of the available funds, can be accessed via the Benefits Portalor the Scheme’s own dedicated website www.friendslife.community/prhscheme

After reading the Investing for Retirement guide, should you still feel unable to make afund selection, your contributions will be invested within the Scheme’s default fund, theLifecycle Option, details of which are included within the Investing for Retirement guide.

Contributions of those who join the Scheme from 1 April 2016 will automatically beinvested within the Lifecycle Option. If you want to make an alternative selection youmust register for Friends Life’s online service, through which you will be ableto indicate the fund(s) you wish to invest in. You can register for this service by visitingthe Benefits Portal and clicking on the link or by visiting the Scheme website.

You should note that neither the Company nor the Trustees are able to advise you whichfund or funds you should invest in. Therefore if you are at all uncertain about which fundor funds to invest in you should take, at your own expense, independent financial advice(see www.unbiased.co.uk).

Please read the Investing for Retirement guide which accompanies this booklet.


RetirementHow much will I get?

The amount of income you will receive in retirement is not guaranteed and is dependentupon the final value of your pension account, your age and, if you decide to secure yourretirement income by purchasing an annuity, the actual cost of buying the type ofpension you require at the time you retire.

When can I retire?

Unless you instruct Friends Life otherwise, it will be assumed that you wish to retire onthe Scheme’s Normal Retirement Date, which is currently 65. When you join the Schemeyou are able to choose an alternative age, providing it is at least age 55. You can amendyour Selected Retirement Age (SRA) at any point by completing an SRA form. Copies canbe obtained from the scheme website www.friendslife.community/prhscheme or via theRoost or Notebook intranets. Note that you do not have to stop working in order to draw yourbenefits.

What will I receive?

When you decide to retire you can use your pension account to:

1. Buy a pension for yourself. Your pension will be subject to income tax but is notsubject to National Insurance.

2. Take all your pension account as a cash lump sum. One quarter of this amountwill be tax, with the remainder being subject to income tax at your marginal rate.

3. Take part of your pension account as a lump sum and use the remainder to purchase apension.

4. If you decide to purchase a pension, you can apply part of the fund to provide apension for your Spouse or other Dependant upon your death after retirement.

Alternatively, if you want to take advantage of other pension options available outside ourScheme you can transfer the value of your pension account into another pension vehicleprior to drawing your benefits.

Deciding how to take your benefits at retirement is complex and we recommend youseek independent financial advice before you retire. Neither the Company nor theTrustees are able to provide advice in this area.

Early retirement or Incapacity

Subject to the consent of the Principal Employer and the Trustees, you can draw yourbenefits at any age from age 55 onwards. Earlier retirement may also be possible in theevent of serious ill-health, and is at the discretion of the Trustees and Company.The level of benefits payable will depend on the value of your pension account at the timeyou retire.

Late retirement

If you continue to work beyond your Normal Retirement Date, and you havedecided not to receive your retirement benefits, contributions to your pensionaccount will continue as long as you remain an active member of the Scheme.


Pension payments

At retirement, if you decide to buy a pension under the Scheme an annuity will bepurchased by the Trustees from an insurance company which will take overresponsibility for the pension payments. When you retire, the Trustees will arrange for competitive quotations for purchasing your pension to be offered to you butthey are unable to provide you with advice on the structure of your pension.

You do not have to accept any of the options offered to you and, if you wish toinvestigate the full range of options available you should consult an IndependentFinancial Advisor.

Further information about the options available will be provided as youapproach retirement.

What happens on my death after retirement?

This will depend upon the benefits you decide to purchase at the time of retirement.For instance if you choose to buy an annuity with an attaching spouse’s pension,the spouse’s pension would start to be paid upon your death.

You will be provided with information setting out the issues you need to consider atthe time of retirement and the decision will be yours.


Benefits on DeathDeath in service

A lump sum will be payable if you die as an employee of the Company and are under theage of 70. Unless you have elected for a different multiple via the Company’s flexiblebenefit arrangements the lump sum amounts to four times your annual basic salary atdate of death before any salary sacrifice. The value of any personal contributions youhave made to the Scheme (including any contributions made via Salary Sacrifice andany AVCs) will also be refunded.

In addition, a pension of 20% of your Pensionable Salary is payable to your survivingSpouse or Dependant – subject to the necessary underwriting if you join the Schemeas a late entrant.

Dependants’ pensions

If you are unmarried but leave one or more Dependants, a pension equal to the Spouse’spension may be shared amongst them as decided by the Trustees. Even if you aremarried, the Trustees may at their discretion reduce the Spouse’s pension and paypensions to one or more of your Dependants, where appropriate.

Payment of death benefits

The Trustees have absolute discretion regarding the recipient of any lump sum deathbenefits. As a result, under current legislation, the payment does not form part of yourEstate and will generally be paid free of tax. However, if the total lump sum deathbenefits from all pension schemes exceeds the Lifetime Allowance at the time of death,then any excess above this allowance will be subject to tax.

You can help the Trustees decide who should receive the lump sum by completing anExpression of Wish form. You can also download a copy of this form by visiting theBenefits Portal, the Scheme website (www.friendslife.community/prhscheme) or theRoost or Notebook intranets.

You should remember to complete a new Expression of Wish form should your personalcircumstances change. However, you should note that payments are made entirely at theTrustees’ discretion.

Note:1. If you die leaving a Spouse or Dependant (other than Eligible Children) who is more

than 10 years younger than you, the Trustees may reduce the resulting pension. Anysuch reduction will not exceed 2.5% for each year of age difference greater than 10.

2. The benefits payable on the death of a Member are insured through an insurancecompany. In exceptional circumstances these benefits may be subject to restrictionsimposed by the insurance company. If you are affected, you will be informed.

3. Provision of death benefit cover may be subject to receipt of medical evidencesatisfactory to the insurance underwriter if you join other than when first eligible. Those continuing in service beyond Normal Retirement Date will also require specialunderwriting.


Leaving the SchemeSummary

Your contributions and those of the company will automatically stop when youremployment with the Company ends. You can also opt out of the Scheme withoutleaving employment by giving the Trustees one month’s written notice (an opt-out formis available from the Pensions Manager). If you opt out you have no right to rejoin theScheme. You may be permitted to rejoin if the Principal Company and the Trusteesagree but special terms may be imposed.

When you leave the Scheme, all contributions will cease and you will have a number ofoptions regarding your pension account.

Less than one month’s Pensionable Service (if you joined on or after 1 October 2015)or less than 2 years’ service (if you joined before 1 October 2015)

You will have two options:a) Receive a refund of the value of the contributions you made to the Scheme,

excluding those made via salary sacrifice, less tax. The Employer’s contributionswould be retained within the Scheme.

b) Transfer the value of your pension account, including the Company’scontributions, into another pension scheme.

More than one month’s Pensionable Service (if you joined on or after 1 October 2015)or more than two years’ Pensionable Service (if you joined before 1 October 2015).

Your options would be:a) Leave your pension account invested within the Scheme.b) Transfer the value of your pension account, including the Company’s

contributions, into another pension scheme.

If you have transferred benefits into the Scheme from a personal pension scheme yourcontributions will not be refunded and you will be able to leave your pension accountinvested within the Scheme.

A deferred pension is calculated in the same way as a retirement pension and isdependent on the value of your pension account at the time you retire.Although no further contributions will be paid, your fund will continue to be investedand you will receive annual statements. The value at retirement will depend on theinvestment performance achieved.

If you die before the pension comes into payment, the value of your pension accountwill be available to provide benefits for your Spouse and Dependants.


Transfer to another scheme

If, at some time in the future, you join another company which operates or participatesin a pension scheme or you take out a personal or stakeholder pension, it is normallypossible, should you wish to, to transfer the current value of your pension account tothat other scheme. However, you will need the agreement of the trustees or providersof that scheme.

The administrators of the new scheme will advise you of the benefits available shouldyou transfer.

Transfer options

You may transfer your pension account out of the Scheme at any time after you leavethe Scheme.


General InformationDevelopment of the Scheme

The Scheme was set up in 1991 after the merger of Random House UK Ltd and CenturyHutchinson Ltd and incorporates the assets and liabilities of the schemes operated bythese two companies. The Defined Contribution section of the Scheme was establishedon 1 July 2002. The Scheme changed its name to the Penguin Random House PensionScheme with effect from 1 April 2016.

The assets of the Scheme are totally separate from the assets of the Company and canonly be used in the manner laid down in the Trust Deed and Rules.

Tax approval

The Scheme has been approved as a registered pension scheme by Her Majesty’sRevenue & Customs. This means that certain maximum levels of benefits cannot beexceeded and you will be notified if these apply to you.

Because the Scheme is an approved scheme, your contributions to the Scheme aretax-free (subject to certain limits), most of the Scheme’s investment returns are tax-free(except for certain dividend income) and you currently have the option to take tax-freecash at retirement.

Contracting out

Members of the Scheme are not contracted out of the State Second Pension Scheme(S2P). The Scheme is a contracted-in money purchase scheme and the benefits payablefrom this Scheme will be in addition to the pensions provided by the State PensionScheme.

Transfers in

The Trustees may, at their discretion, accept transfers from other compatible taxapproved pension schemes. Any transfer values received will be added to your pensionaccount.

Assignment

Your Scheme benefits are personal to you. They must not be assigned, promised to an-other person or used as security for any loan or mortgage. If you assign your rights toanother person your Scheme benefits will be forfeited.

Forfeiture of benefits

If you owe money to the Company or the Scheme because of crime, negligence, fraud orbreach of trust on your part, the Company or the Trustees may require your benefitsunder the Scheme to be reduced and the Company may require the payment to it of theamount of the reduction.

If you dispute the debt or its amount, the Principal Company may direct the Trustees tosuspend the payment of benefits to you until the debt is enforceable under a court order.


Temporary absence

Temporary absence counts as Pensionable Service if you continue to receive salary or anincome from which contributions can be deducted.

Temporary absence will not normally count as Pensionable Service unless you paycontributions to the Scheme. Your Pensionable Service will then be decided byagreement between the Company and the Trustees.

Maternity or Paternity Leave

During a period of paid maternity, paternity, adoption or parental leave, a member of theScheme will continue to pay contributions and will be covered for Death in Servicebenefits. Members will pay contributions based on the amount of their basic earnings ormaternity pay actually received. The Company will continue to pay contributions at a rateappropriate to your own.

If you were to die during your absence, you would receive the same benefits as describedin the section headed Benefits on Death but based on the Pensionable Salary being paidimmediately prior to your starting your maternity leave.

If you are absent on maternity or paternity leave, you will continue to be regarded as inPensionable Service for the duration of your basic maternity leave (which lasts for at least18 weeks) and, if longer, while you are receiving pay (even if this is only StatutoryMaternity Pay). You will pay contributions on the pay you are receiving, and theCompany will continue to pay contributions at a rate appropriate to your own.

If you plan to have extended maternity leave, then please contact your HR Department todiscuss your options. If you do not return to work after maternity leave, then yourPensionable Service will normally cease at the date you stop contributing to the Scheme,or at the end of your paid maternity leave period, if later.

Scheme Documents

Apart from this booklet, you can see the following documents:

• The Trust Deed and Rules• The Annual report and Accounts• The Statement of Investment Principles

Amendment or discontinuance

The Principal Company intends to keep the Scheme in force for the foreseeable futurebut the Trust Deed and Rules allow for amendment or termination of the Scheme at anytime. If the Scheme is discontinued, the Trustees will use the Scheme’s assets to providebenefits in accordance with the Trust Deed and Rules.


Further information

If you have any questions about the Scheme or your benefits, please ask the PensionsManager. Questions which cannot be answered locally will be referred to the SchemeAdministrator.

If you have left the Company all queries should be referred, in writing, to theScheme Administrator:

Friends LifePO Box 1550SalisburySP1 2TW

) 0345 072 7204 Email: [email protected]

Internal Dispute Resolution

The Scheme has procedures in place to deal with disputes or complaints which cannotbe resolved informally.

If you need to use these procedures, a form can be obtained from the PensionsManager. Once you have returned this form, you should receive a reply within twomonths.

If you are not satisfied with the answer you can ask the Trustees to review your case.You can involve the Pensions Advisory Service at any stage, if you so wish. If yourdispute is still unresolved then you can contact the Pensions Ombudsman.

Data Protection Act 1998

This governs how the Trustees and the Company may hold and process personal dataabout you to allow them to run the Scheme.

The Trustees and the Company already hold and process personal information aboutyou – such as your name, address and National Insurance number and PensionableService and Gross Earnings – which they need to calculate your benefits under theScheme. For many Members, the Trustees also hold details set out on Members’ Expression of Wish forms to apply in the event of their death.

This information may be passed to the Scheme auditor, the Scheme administrator andother third parties as may be necessary for the administration of the Scheme.

It is important that the information the Scheme holds about you is kept up to date.This is why we ask you to let us know of any changes to your personal details such aschanges to your address or marital status.


Useful AddressesPension Tracing Service

The Scheme has been registered with the Pension Tracing Service. This will enableMembers who lose contact with the Scheme to trace their benefits. The Pension TracingService can be contacted at:

Pension Tracing ServiceThe Pension ServiceTyneview ParkWhitley RoadNewcastle-upon-Tyne NE98 1BA

) 0845 600 25378 www.thepensionservice.gov.uk

The Pensions Advisory Service (“TPAS”)

If you have any complaint or dispute in connection with the running of the Scheme, youshould contact the Pensions Manager in the first instance. However, TPAS is available toassist Scheme Members and beneficiaries with any difficulties they may have with theirScheme. The contact details for TPAS are:

The Pensions Advisory Service11 Belgrave RoadLondon SW1V 1RB

) 0845 601 2923Email: [email protected]

The Pensions Ombudsman

The Pensions Ombudsman investigates complaints of injustice and disputes of fact orlaw with the Trustees, Managers or Employers. The services are available to Schememembers, beneficiaries and prospective members. The contact details are:

The Pensions Ombudsman11 Belgrave RoadLondon SW1V 1RB



The Pensions Regulator

The Pensions Regulator is responsible for the regulation of all work-based pensionschemes in the UK. It has extensive powers, including powers to suspend, disqualifyand remove trustees, appoint trustees, wind up schemes and apply for injunctions toprevent misuse or misappropriation of assets.

The Pensions Regulator also has the power to impose civil penalties and prosecuteindividual trustees.

The contact details for The Pensions Regulator are:

The Pensions RegulatorNapier HouseTrafalgar PlaceBrighton BN1 4DW


The Pensions Manager

The Pensions Manager is based at:

Penguin Random House20 Vauxhall Bridge RoadLondon SW1V 2SA

) 020 7840 8642


Pension terms explainedSome expressions are frequently used in this booklet and have special meanings.They are explained below:

ACTIVE MEMBERA person who, subject to any restriction caused by a temporary absence or maternityleave, is in Pensionable Service under the Scheme.

AVCsAdditional voluntary contributions which you choose to pay to the Scheme.

ANNUAL ALLOWANCEThere is no limit on the amount of pension savings which can be made in any year butthere is a limit on the amount which qualifies for tax relief. The amount of saving whichqualifies is known as the “Annual Allowance”.

The basic Annual Allowance is reviewed from time to time and has been set at £40,000for the 2016/2017 tax year. Members whose “income” is in excess of £150,000 in a tax yearwill have a lower Annual Allowance than this.

COMPANYThe Company which employs you and takes part in the Scheme.

DEFERRED PENSIONERA former Active Member who retains an entitlement to benefits under the Scheme basedon the value of his/her own pension account.

DEPENDANTYour Spouse, Eligible Child or any other person the Trustees might consider to be whollyor partly financially dependent on you for maintenance and support.

EARNINGS CAPThe maximum annual salary permitted by Her Majesty’s Revenue & Customs under theterms of Section 590C(2) of the Income and Corporation Taxes Act 1988 for thecalculation of approved pensions, death benefits and contributions.

If, in any year, there is no Earnings Cap set under Section 590C(2), Earnings Cap shallmean the last Permitted Maximum in force as defined in Section 590C of the Income andCorporation Taxes Act 1988, increased in each subsequent year by the increase in theRetail Prices Index each September and rounded up to the nearest £600.

The Earnings Cap deemed to be in force from 6 April 2016 is £150,600. This amount isreviewed annually.

ELIGIBLE CHILDRENOne or more of your children who is under 18 years of age or under 23 if infull-time education or training approved by the Trustees.


GROUPThe Penguin Random House Group Limited and any associated, subsidiary or other companies which take part in the Scheme.

INCAPACITYA physical or mental deterioration which either permanently prevents you from carryingout your normal job or seriously impairs your earning capacity. The Trustees’ decisionas to whether a Member is suffering from Incapacity is final.

THE LIFETIME ALLOWANCEThe Lifetime Allowance means the maximum value of all monies held in registeredpension schemes without giving rise to an excess tax charge. This figure is reviewedfrom time to time and from April 2016 stands at £1 million.

If the total value of all monies held in registered pension schemes upon your retirementexceeds the Lifetime Allowance, a tax charge of up to 55% will be levied on the excess amount.

MEMBERA person who is an Active Member or a Deferred Pensioner.

NORMAL RETIREMENT DATEYour 65th birthday.

PENSIONABLE SALARYPensionable Salary is fixed on each 1 January and means your basic annual salary fromthe Company, subject to the Earnings Cap.

PENSIONABLE SERVICEYour period of service while an Active Member including any period arising from atransfer of pension rights into the Scheme.

PENSION ACCOUNTThe fund holding the investments arising from the contributions paid by you and bythe Company on your behalf.

PRINCIPAL COMPANYThe Random House Group Limited.

SCHEMEThe Penguin Random House Pension Scheme.

SPOUSEYour wife, husband or civil partner as specified under the terms of the Civil Partnership Act.

STATE PENSION AGEThe age laid down by statute for commencement of the state pension.

TRUSTEESThe individuals who are responsible for ensuring that the Scheme is administered inaccordance with the Trust Deed and Rules and for managing its funds.

