Pensions Glossary - G

Pensions Quote Line

0845 108 0505

• Home
• Credit Cards
• Loans
• Investments
• Life Insurance
• Mortgages
• Insurance

G...

Garage. To transfer assets to another company to reduce tax liability.

Garnishee Order. A court order preventing a person owing money to another person from paying it, until that second person has satisfied other claims outstanding against him or her.

Gazumping. Accepting an offer which is later rejected in favour of a higher offer when selling a house. Particularly prevalent in the late 1980's when house prices increased almost on a daily basis. Gearing. The ratio of ordinary share capital and reserves to borrowings.

Gift with Reservation. A transfer of value in which the donor retains an interest. e.g. the donor gives a house to a friend, on condition the donor continues to live in the house.

Gifts. See 'Transfers'. Gifts on Marriage. Gifts in consideration of marriage are, under IHT rules, exempt lifetime transfers within certain monetary limits, and vary in amount depending on the family relationship of the donor and recipient.

Gilts. 'Gilt edged securities' are fixed rate bonds issued and guaranteed by the UK government. The bonds pay fixed interest. Traded on the Stock Exchange, and can also be purchased at Post Offices through the National Stock Register. Originally, the bond certificates had a gold border, hence the name Gilt Strip. Where each interest payment and the redemption value become investments in their own right which can be bought and sold.

Girobank. Banking system run through the Post Office which permits account holders to transfer funds from one account to another, not necessarily in the same system, without charge and without use of cheques. Give as you earn. A system of donating to charity direct from one's salary, which attracts tax relief at the highest tax rate payable.

GmbH. Gessellschafft mit beschrankter Haftung. Literally, company with limited liability; a German private company.

Golden. Used in a number of ways e.g. Golden Hello - cash inducement to encourage someone to join a new company.

Golden Handcuffs - a contract which makes it financially attractive to stay, but potentially financially unattractive to leave.

Golden Handshake - a large cash sum, some of which will be tax free, paid to employees who leave, usually not of their own accord, before the end of a service contract.

Golden Rule - a rule of statutory interpretation allowing the court to depart from strict procedures of interpretation of words if it would lead otherwise to an absurd result.

Goodwill. The value of a business over and above its book value of assets, which may literally represent the goodwill of customers or the skill and expertise of company employees. An intangible asset which may appear under fixed assets.

Gower Report 1982. A government sponsored report into investor protection. The results ultimately lead to the enactment of the Financial Services Act 1986 which established a policy of self regulation overseen by a Government agency i.e. SIB.

Graduated State Pension Scheme. The forerunner of SERPS, which operated from 1961 to 1975. A money purchase arrangement, where units of weekly pensions were purchased by units of contribution of £7.50 (males) and £9.00 (females). The pension units were revalued up to State Pension Age. Discontinued in 1975, due to the minimal retirement benefits being accrued. The unit of contributions are to be equalised to £7.50, under the Pensions Act 1995.

Graph. A drawing representing the relationship between two sets of data, one set represented on a perpendicular scale or axis, the other on a horizontal scale or axis. The relationship is plotted where the two scales intersect, the line between meeting points generally being called the graph.

Grant of Probate. A certificate issued by an English court validating a will and authorising the executors to administer the estate.

Gratuity. Usually taken to mean a cash gift or tip for services rendered. Also a cash sum paid to British service personnel on leaving the service.

Green Book. London Stock Exchange publication detailing USM trading regulations.

Green Card. Car insurance certificate used by British motorists driving abroad. US work permit needed by foreigners working in the US.

Green Currency. EC 'nominal' currency for dealing in agricultural payments, each member currency having an agreed exchange rate.

Green Paper. Preliminary report on proposals for a new law to be discussed in Parliament. Precursor to a White Paper. Greenback. Slang for US dollar bill.

Greenmail. Almost blackmail, in that the exercise involves buying enough shares in a company to threaten a takeover bid and all the expenses that exercise involves, but then selling the shares back to the company at a higher price than was made.

Gross. The sum total, without deduction.

Gross Domestic Product. The total value of finished goods and services produced within an economy over a specific period, normally one year.

Gross National Product. GDP plus net property income and profits from abroad.

Gross Profit. The difference between cost of sales and revenue before deducting general running/overhead expenses.

Grossing Up. Converting a net amount into its corresponding gross amount e.g. calculating a rate of return; anticipating a tax deduction on a gift or will bequest.

Group Life. A life assurance scheme operated by an employer for his employees. May be stand-alone or running alongside an occupational pension scheme. Will pay out, tax free, a maximum of 4 times qualifying salary, (final remuneration), plus spouses/'dependants' pensions.

Group Pension. Generally operated by an employer for a group of employees and may be a 'conventional' scheme where the employer helps fund the arrangement; or may be a group personal pension scheme where the grouping is merely for administrative convenience. Alternative name for occupational pension scheme.

Group PHI. Group PHI is usually set up by the employer. Unlike personal PHI, there may be an element of free cover, and any claim is generally paid to the company, which continues to pay the employee via the PAYE system. Guaranteed Annuity Option. Some pension policies may have a 'safety net' guarantee as a safeguard against heavy market fluctuations.

Guaranteed Death Benefit. A minimum amount of life assurance paid out under a unit-linked policy if the fund value is not higher.

Guaranteed Income Bond. Single premium insurance bond that guarantees the repayment of a capital sum at a future ate.

Guaranteed Minimum Pension. When a group occupational pension scheme contracts out of SERPS, the scheme must provide a minimum pension in respect of the amount of state pension foregone. This is the GMP, and is approximately equal to SERPS, for the same period. A member of such a scheme is guaranteed to receive a pension at State Pension Age not less than the SERPS equivalent. The GMP principle ceased for benefits accrued after 6th April 1997, when the Reference Share principle was established.

Pensions.co.uk is part of a large network of financial sites created to help advise you on life events, such as buying a house (Mortgages.co.uk), insuring your car (Carinsurances.co.uk), your life (Lifeinsurance.co.uk) and your home (Homeinsurance.co.uk). Remember that your ISA allowance allows you to save upto £7000 each year tax free. Try 0800 ISAs portal to find some of the best options.

1998 - 2007 UK Pensions - Planning before, at the onset and during retirement - Pensions.co.uk