Pension basics for vets: What you need to know

Vet careers often involve burnout, career changes, or an early exit from clinical work so pensions give you options. With long periods of training meaning a later start to earning early pension contributions really help. We also know that a vet’s income can vary (especially for locums), making consistent pension habits a challenge but even more valuable.

Workplace pensions in practice

If you’re employed by a practice, you can expect to receive employer contributions which in some practices can be higher than the legal minimum to be paid into your pension. With Auto-enrolment you’re added automatically to a pension if eligible and you should always contribute enough to get the full employer match this is effectively additional pay from your employer. However, this will only benefit employed vets in permanent roles.

Pensions for locum vets

Doing locum work as a vet gives you flexibility but you will need to take charge of your pension. Unlike employed vets Locums don’t get employer contributions. This will mean that you will need to open a personal pension or SIPP and adjust contributions to reflect your earnings and affordability. It’s important to understand that contributions come with tax relief, which may reduce your self-assessment tax liability depending on your circumstances.

Practice owners & partners

If you own or co-own a practice a Self-Invested Personal Pension (SIPP) can, in some cases, be used to purchase commercial property (including your practice building). Eligibility, tax treatment and risks apply, and regulated financial advice should be taken. Pension contributions made by the business may be tax-deductible, subject to HMRC rules and individual circumstances and are Ideal for long-term planners building business and retirement value. Advice should always be sought on this from an independent financial adviser.

How does your pension grow

Your pension benefits from paying personal contributions and if employed the practice/employer will add contributions. On top of this the fund benefits from tax relief, with basic rate tax relief added automatically and any higher or additional rate relief typically claimed through your tax return. Your pension fund then benefits from investment growth over time. Many providers offer default investment options, but you should ensure your investments remain appropriate for your circumstances. On top of this many providers offer ethical/sustainable funds for those vets looking at alternative investment options.

When can vets access their pension?

You can usually draw your pension from age 55 although this is rising to 57 in 2028. When you start drawing your pension the first 25% is tax-free up to certain limits with the balance taxable at your marginal rate of income tax. Therefore, it may be useful to draw part of your pension to supplement your income if you’re a vet easing into part-time work, teaching, management, or less clinical roles which may involve a reduction in your earned income.

Vet-specific challenges with pensions

We know Vets often start their working life with large Student loan balances but it’s important to understand that this shouldn’t stop you from starting early. If you do decide to take a Career break maybe from burnout, maternity leave, or role changes which are common for Vets, your pension will remain invested and may grow over time, although investment returns are not guaranteed. It’s also possible to continue to contribute up to £3,600 gross per year (£2,880 net) and still receive basic rate tax relief, even when not working. Because working as a vet can be a Physically demanding job, we understand that many vets step back earlier. A pension can help to support a phased retirement and the sooner and the more you save into your pension the more options are available to you later in your career.

About Chase de Vere and the BVA partnership

Chase de Vere is a partner of the British Veterinary Association (BVA).

Our advisers understand many of the realities vets face – including moving between practices, locum work, self-employment, ownership and changing working patterns.

As part of this partnership, BVA members can book a free initial chat with one of our specialist advisers to ask questions and gain clarity with no obligation. Book a free initial chat with a Chase de Vere adviser

Important information

• This article is for information purposes only and does not constitute personal financial advice. Decisions should be based on your individual circumstances, and you should seek personalised advice before taking any action.
• Past performance is not a reliable indicator of future performance.
• Levels and bases of, and relief from taxation is subject to change.
• The value of your investment can go down as well as up and you may not get back the full amount you invested.
• The Financial Conduct Authority does not regulate taxation advice, estate planning, inheritance tax planning, cashflow modelling, wills or trusts.
• The tax implications of pension withdrawals will be based on your individual circumstances, tax legislation and regulation which are subject to change. You should seek advice to understand your options at retirement.

Book a free initial chat with a Chase de Vere adviser.