Armed forces pension increase at 55

Why your pension is flat until 55

Public service pensions rise every April under the Pensions (Increase) Act 1971, but the Act holds back increases on pensions paid before 55 unless an exception applies. For AFPS 75 the rule is written into the scheme itself. Rule D.23(2) says the increases apply to an immediate pension "only in relation to amounts of pension payable on or after the member's 55th birthday", unless it is an ill-health pension or the member applies on medical grounds.

The MOD puts it more simply in its scheme guide: "This pension will be a fixed sum until you reach the age of 55. At this point, it will be increased to take account of the total rise in the cost of living since your Service ended and after age 55 it will increase annually in line with the Consumer Price Index (CPI)."

Under AFPS 05 the position is different. Its normal pension age is 55, so an AFPS 05 pension is not normally in payment before 55 at all. The AFPS 05 benefit that is held flat until 55 is the Early Departure Payment income, covered below.

How the catch-up is worked out

The increases are counted as if your pension had started on the day after your last day of service. Each April's increase is added on top of the previous ones, so they compound. The first increase after your pension starts is reduced if it had been in payment for less than a full year by then, according to how many complete months had passed.

Nothing is paid on those increases before 55. On your 55th birthday your pension goes up to the fully compounded rate in one step, and from then on it rises each April like any other pension. There is no back-pay for the increases that built up while you were under 55.

The Forces Pension Society adds one point worth knowing if you took resettlement commutation: the increase "will be based upon your original pension award, not any reduced amount you might be receiving due to Resettlement Commutation". Our resettlement commutation guide explains that option.

The official increases since 2016, and what they add up to

These are the April increases set by each year's Pensions Increase (Review) Order. There was no increase in April 2016, because inflation over the year to September 2015 was negative. The last two columns show what the increases add up to by April 2026, counting from that April onwards.

To use the table, find the first April after your pension started. If your pension had been in payment for close to a full year by then, use that row: multiply your starting annual pension by the figure shown. If it started later in the year, your first increase was cut back by the number of complete months, so your figure sits a little below that row and above the next one down.

If you turn 55 after April 2026, each later April increase is added on top in the same way. The April 2027 rate depends on September 2026 inflation, and our 2027 pension increase page will carry it once it is confirmed.

Worked example: £10,000 from April 2016

Take an AFPS 75 Immediate Pension of £10,000 a year, not an ill-health pension, starting on 20 April 2016, for someone whose 55th birthday was 10 April 2026. The 2017 Order gave the full 1.0% to pensions that began between 11 and 25 April 2016, so every increase from 2017 to 2026 applies in full.

Multiplying them together gives 1.392112. On 10 April 2026 the pension went from £10,000.00 to £13,921.12 a year, a rise of £3,921.12, or 39.2%. Monthly, before tax, that is £833.33 rising to £1,160.09. HM Treasury's own 2026 multiplier for pensions that began between 27 March and 25 April 2016 is 1.3921, which matches.

The start date matters. The Treasury table gives 1.3910 for a pension that began between 26 April and 25 May 2016, because its first increase was cut to 0.92%, so the same £10,000 would have reached £13,910.10.

Because nothing is back-paid, the increases that built up but were not paid before 55 are simply lost. In this example they come to roughly £13,100 over the ten years. Someone on an ill-health pension of the same size would have received that money year by year.

Early Departure Payments at 55

An Early Departure Payment is not a pension, but it has its own rule with the same effect.

EDP 05 is paid flat until 55. The MOD's policy guide says: "At age 55, the monthly payment will be increased from the initial percentage calculated to the equivalent 75% of preserved pension. At age 55, the EDP income level is adjusted for inflation." So two things happen at once: the rate steps up from around 50% to 75% of your preserved pension, and the catch-up for every increase since you left is applied. After that it rises every April, and it stops at 65, when your preserved pension starts. With a preserved pension of £10,000 and the same April 2016 start as the example above, the EDP from 55 would be about £10,441 a year.

EDP 15 is also flat until 55, then caught up for every increase since it started and increased every April after that. There is no step up in the percentage at 55. It stops at your State Pension age, when your deferred pension starts. If you draw your deferred pension early from 55, the EDP carries on alongside it until State Pension age.

Who gets increases before 55

The age-55 hold does not apply to everyone. These are increased from the start, whatever your age:

• Ill-health pensions: an AFPS 75 invaliding pension, and AFPS 05 and AFPS 15 Tier 2 and Tier 3 pensions. Tier 1 is a lump sum, so there is no income to increase. Our medical discharge guide explains the tiers.
• A preserved or deferred pension paid early because you are permanently unable to work.
• Survivors' and children's pensions.
• Any pension that starts at 55 or over.

There is one more route for AFPS 75. If you are under 55 on an Immediate Pension and become permanently incapable of any full-time work, you can apply to have the increases paid from the date your application is received. The application has to be backed by evidence from a registered medical practitioner.

Preserved and deferred pensions

If you left before 55 without an Immediate Pension or an EDP, your pension is preserved (AFPS 75 and 05) or deferred (AFPS 15) until pension age. There is no age-55 hold on it. The increases build up from the day after you left, and all of them are included when the pension is paid, whether that is at 60, 65, State Pension age, or earlier with a reduction. Our preserved pension guide covers when and how to claim, and armed forces pension age sets out the ages scheme by scheme.