Uk Pension, Changes Being Planned

[DoubtingThomas]

Simple - just keep an UK address.

Yes, all very well BM, but these days Big Brother is watching you. I remember the good old days when I was traveling (sorry Brits, it's the US spell checker, honest!) almost every week out of Heathrow they never even looked at your passport, actually in or out, it was just a "wave through". Try that now. They know when you last took a crap!

[theoldgit]

Before folks get carried away with conjecture please remember that these changes are at the green paper stage, nothing has been agreed and any implementation is unlikely before 2015.

Totally agree and people are jumping to conclusions.

[bunple]

"This was the quote in the newspaper article ( The payment would be based on citizenship or residency, with British citizens or anyone who has been living in Britain for a fixed number of years qualifying ) end quote. Which one it will it be? To save the most money it will be Residency just as the Nation health service policy."

The way I read that statement it was either of the conditions, EITHER a citizen OR a resident.

[elshaheen]

Talk to those who get their pensions from Social Security in the U.S. They won't be getting their cost of living increases, which is roughly about $200 a month for the second year in a row.

Rubbish, the average monthly US SSC pension payment is under USD 2k per month and official inflation is almost negative hence COLA is zip!

It is not rubbish. I get it for my services to the U.S. Military in Afghanistan and Pakistan. I was shot in the in both knees, and hip and in the chest. I have the marks to prove it.

Now, the average pay now for someone on disability is $845.00 a month. 2k if you let it sit in a bank account in the U.S., but you don’t let it sit there, why. Social Security can see just how much you have. If you have say, $2001.00 in your bank, they will deduct that $1.00 from what you receive. The amount most will save in a U.S. Bank account is 2 deposits or how much you receive. Money is transferred from your home bank to a bank in Thailand how a Thai bank who happens to have an office in your home country. Example: Korea, Japan and China all have their own branches in the U.S. as well. This is in order to allow citizens of their countries to send and receive funds from the U.S. All they have to do is transfer, and then wait a few hours or a day. Go to their counties bank in the country they are currently residing in. This is called Money Laundering, a felony in the U.S.

I know of many foreigners who are doing this now, in Thailand and throughout Asia. That is why some westerns who received this have to go back every three years, for evaluation.

Now, if you are retired and collecting a pension that way, no problem, or SSA or your retirement pension.

The other mentioned about is disability, or SSI.

Your pension is tagged to your countries currency market and it can go up and down as the market fluctuates.

For the last two years, the economy has been down and still continuing to fall. The cost of living has remained the same for where you live. BTW, if your residency is in Hawaii, you get the highest allowance. If one of the smaller states, you get the least. So, congress and the president have felt a need for a cost of living increase is not needed, which last year was $200.00. They only sent out a $250.00 bonus. Bush went hog-wild and decided to throw all or most of the money in Social Security as free handouts. This year is the same, no cost of living increase. Maybe a small bonus to Social Security recipients.

[Beetlejuice]

Simple - just keep an UK address.

Yes, all very well BM, but these days Big Brother is watching you. I remember the good old days when I was traveling (sorry Brits, it's the US spell checker, honest!) almost every week out of Heathrow they never even looked at your passport, actually in or out, it was just a "wave through". Try that now. They know when you last took a crap!

Right on.

I know of several Brits over here that have been tumbled and are now paying the price.

I also agree with the many other posters that we should not assume anything at this time until it`s officially confirmed, but of course we do have good reasons for our concerns. I do blame the media and the UK government for the ill defined way they have described the terms disclosed in these reports that is probably causing a lot of stress and concerns among UK ex-pats worldwide that are either approaching or are already of pensionable age and depending on their future or present pension incomes to sustain them in the host countries.

All in all, a very bad show by the British government.

[nong38]

Go back to the Daily Mail, more exciting plans revealed and dont forget to bring up about the frozen pension for ex pats.

[Lite Beer]

This is how The Guardian words it.

Instead of basing pensions on means testing, the new system would be based on residency, with British citizens or people who have been living in the country for a certain number of years qualifying.

[thaimate]

It has just been reported in the Daily Mail that the pension increases will be for new pensioners only,repeat new pensioners only ,anyone who is recieving a pension at present and up to the time of the changeover will just recieve the same as they recieve now ,as it would be to expensive to give ALL pensioners the increase .

so for us here in Thailand who are recieving a pension it will make no difference whatsoever.

[chiang mai]

£140 per week in five years time is not a bad deal, but given that existing pensions will increase by at least 2.5% per year, it means that the pension would be worth £112 in five years anyway, even if the government did nothing new - basically, the average non ex-pat pensioner will be £28 per week better off although I suspect that for many the increase will simply push them into paying tax sooner.

As for the new pension only being payable to new pensioners, it may benefit anyone who has not started to take their state pension to delay until after 2015, in my case I become eligible in 2015 so it's borderline.

Edited October 26, 2010 by chiang mai

[steve187]

i did a pension forecast on the 8/11/2008, the basic pension with 30 years contributions at todays rates is £90.70, and again on the 4/8/2009 and the figure had gone up to £95.25 an increase of £4.55 or a 5% increase, my actual pension forecast, with additional pension and graduated pension had gone up by £5.08 in a one year period. so using those figures when i retire in 10 years (or when Cameron thinks the country can afford for me to retire) the basic pension should be about £150.00 per week

[steve187]

£140 per week in five years time is not a bad deal, but given that existing pensions will increase by at least 2.5% per year, it means that the pension would be worth £112 in five years anyway, even if the government did nothing new - basically, the average non ex-pat pensioner will be £28 per week better off although I suspect that for many the increase will simply push them into paying tax sooner.

As for the new pension only being payable to new pensioners, it may benefit anyone who has not started to take their state pension to delay until after 2015, in my case I become eligible in 2015 so it's borderline.

Don't forget that at age 65 your personal allowance increases by about £3,000

[chiang mai]

£140 per week in five years time is not a bad deal, but given that existing pensions will increase by at least 2.5% per year, it means that the pension would be worth £112 in five years anyway, even if the government did nothing new - basically, the average non ex-pat pensioner will be £28 per week better off although I suspect that for many the increase will simply push them into paying tax sooner.

As for the new pension only being payable to new pensioners, it may benefit anyone who has not started to take their state pension to delay until after 2015, in my case I become eligible in 2015 so it's borderline.

Don't forget that at age 65 your personal allowance increases by about £3,000

I'm a little confused about the state of personal allowances, they're being increased to £10,000 for everyone by the end of the current Parliament, so effectively 2015 (there's that year again). But I've not read anything about what happens to the allowances after age 65 in 2015, as you say, they would have increased by about £3k but even that increase is still below what they will be anyway at that time.

[travelmann]

I agree it's a worrying point although I confess that I expect to see a point in time where UK and US state pensions are only paid to residents.

This will never happen in the UK, because it would be illegal under European law.

I think at the moment expats get their pension paid abroad, but doesn't go up in value while you are away. So if you live to be 100, your pension will be worth next to nothing in your later years. Pensioners are a huge drain on the health service, so I think it is in the government's interest to pay pensions to people living abroad.

I suppose the answer is to make sure you make your own private pension arrangements and don't rely on the state pension.

I read that the residency part would be based on how many years you lived in UK, not if you were there when pension was paid. So if you moved to Thailand at 50, you robably have enough "UK years" to claim the pension. This is a vey long-term aim though and won't happen for 5-10 years.

Yes such good advive take out a private pension (as advised by govt) then wait for "that" company to go bust like one of mine did, then just watch the ads on tv for "were you missold a pension" claim now etc etc

[travelmann]

This is how The Guardian words it.

Instead of basing pensions on means testing, the new system would be based on residency, with British citizens or people who have been living in the country for a certain number of years qualifying.

Ive lived here (UK) 47 years paid in 29 years Ni so far, with 1 year to go for the 30 year rule however Im still 19 years off collecting this pension IF it ever is given me............ which i doubt, You cant trust a word any politician says or does. By that time they will bring in newer changes saying like my chip shop "pensions will only be given to people over 90 if accompanied by both parents riding on shergar and only on February the 29th.................. and Im being optimistic!!

[taff33]

Simple - just keep an UK address.

Not quite so simple all passports are scaned when you leave the UK,and also when you enter another country,not forgeting new UK passports have a micro chip in them and so big brother is watching :jap:

[nong38]

Vince Cable is quoted on BBC that the changes are to be fair to all, whatever that means. Men and women is the inference but if they keep mentioning fair to all they will find it difficult to say where fairness ends and descrimination starts. As a born and bred in the UK male. I can be accused of descrimination against a new arrival in the country but I cannot accuse a new arrival of descrimination against anyone who was born and bred here, Played 2 lost 2. The rules need to be changed

[RHCP]

'The payment would be based on citizenship or residency, with British

citizens or anyone who has been living in Britain for a fixed number of

years qualifying.'

The way I read it is that the reference to British citizens is separate to the remaining part of the sentence concerning the fixed number of years which I think applies to non-British citizens that are resident in the UK, therefore any British citizens would still be entitled no matter where they lived whilst dependents for example Thai wives living in the UK may not if they don’t meet the yet to be decided number of fixed years of residency. However I stand to be corrected whenever this is properly announced by the Government since the wording is still somewhat vague and worrying, as evidenced by the concerns on this forum.

[steve187]

here is some information looks like allowances frozen for 2010/11 at 2009/10 rates

Personal Allowance amounts

tax year 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11

Age under 65 £4,745 £4,895 £5,035 £5,225 £6,035 £6,475 £6,475

Age 65-74 £6,830 £7,090 £7,280 £7,550 £9,030 £9,490 £9,490

Age 75 and over £6,950 £7,220 £7,420 £7,690 £9,180 £9,640 £9,640

Income limit

for personal

allowances

65-74 and

75 and over £18,900 £19,500 £20,100 £20,900 £21,800 £22,900 £22,900

Income limit for personal allowances

under 65 No limit No limit No limit No limit No limit No limit £100,000

If your income is over the income limit, HM Revenue and Customs (HMRC) will reduce the age-related allowance by half of the amount, £1 for every £2, you have over that limit, until the basic rate allowance is reached. You'll always get the basic allowance, whatever the level of your income, unless, from 6 April 2010, your income is more than £100,000 in the tax year.

For example, if you're 66 and have an income of £23,400, £500 over the limit of £22,900, HMRC would reduce your age-related allowance by £250 from £9,490 to £9,240.

[delboy]

Both, Personal allowances and UK Pension rates, should be increased for 2011-12 in line with September's UK RPI figure which was 4.6%, but I think that the government has already indicated that Personal allowances will rise by a greater amount to move towards the planned 10,000 Pound allowance by the end of this parliament.

[Barack]

Talk to those who get their pensions from Social Security in the U.S. They won't be getting their cost of living increases, which is roughly about $200 a month for the second year in a row.

You have overstated the cost of living adjustment (COLA) which is an average 2.5% (or about $30 per month based on a the average monthly benefit of $1,164). Correct, by law, no COLA adjustment for 2 years because the COLA formula reflects the reality of low inflation.

[nong38]

For tax purposes HMRC are saying that to be considered a UK resident you must have a UK bank account and a residence with a UK address which is available for you use throughout the year. Just because you happen to go travelling for a good proportion of the year should not mean you have your pension frozen, but easy for the government to do if you are not home to deal with it or vote. Interestingly the NHS told me that if I left the UK for more than 3 months I would lose all my benefits but when I reach 65 get them back. I magine if towards the end of the 3 months I got bitten by something and could not return to the UK, how would they deal with that, a real can of worms could be opened. I think IDS seems like a fair chap and maybe we should write a few letters to him when we are in the UK to highlight our plight, chances are he has no idea whats going on

[ignis]

Hopefully it will not come to that.

I can see it being based on 1, citizenship and 2, residency if your not a citizen but actively contributing.

Think of all the 100s of thousands of expats worldwide who will be headed 'home' if their pensions no longer exist.

And straight onto the housing list

While waiting would be put into Hotels, would be a win win for Hotels + a lot more for the UK tax payers then a pension paid overseas

[nong38]

There have benn a few comments on personal tax allowance. I am of the opinion that that jolly chap Nick Clegg has got us a 1000 pound increase from next April (2011-12 tax year) one of the Lib/Dem requirements for the coaliton govt and after big ZERO from the Moron That is what I am looking forward too which will take us to 7445 pa on the way to 10,000. Better than what we have been used too.

[chiang mai]

For tax purposes HMRC are saying that to be considered a UK resident you must have a UK bank account and a residence with a UK address which is available for you use throughout the year. Just because you happen to go travelling for a good proportion of the year should not mean you have your pension frozen, but easy for the government to do if you are not home to deal with it or vote. Interestingly the NHS told me that if I left the UK for more than 3 months I would lose all my benefits but when I reach 65 get them back. I magine if towards the end of the 3 months I got bitten by something and could not return to the UK, how would they deal with that, a real can of worms could be opened. I think IDS seems like a fair chap and maybe we should write a few letters to him when we are in the UK to highlight our plight, chances are he has no idea whats going on

Turn the argument on its head and ask what HMRC considers is the case for non-residency, if in doubt about the answer then Google Gainnes-Cooper.

[nong38]

Well they would consider us resident so they can take tax of us, that is surely their game and how much they liase with other departments and how on the ball they are is open to questions with todays revelations of fraud running into millions of pounds and sub letting of Council properties is central govt any better. As they send all my paper work to my home UK address I am going with what I stated as being the correct one, interesting option but I cannot imagine one question being answered by asking an opposite one is acceptable to HMRC

[nong38]

On a point that might be useful for people to note. For every year you do not claim your pension (state pension only) the government will increase by 10.4% it might be a way of mitigating the frozen gift you take with you when you depart the sceptered isle, assuming you can afford to do so

[chiang mai]

Well they would consider us resident so they can take tax of us, that is surely their game and how much they liase with other departments and how on the ball they are is open to questions with todays revelations of fraud running into millions of pounds and sub letting of Council properties is central govt any better. As they send all my paper work to my home UK address I am going with what I stated as being the correct one, interesting option but I cannot imagine one question being answered by asking an opposite one is acceptable to HMRC

The rules on NHS eligibility and HMRC tax residency are different, in the case of the NHS you become ineligible after three months of non-residency but become elligible again under three different scenario's: 1) emergency treatment offered at A & E. 2) at any time you declare yourself fully resident again 3) at age 65 (I think but am not 100% certain).

Tax residency is much more complicated and home ownership and UK bank accounts are only two small parts of the picture. The problem with tax residency rules is that they are not enshrined in law but rather by practise over time, this means that the overall rules change frequently based on individual cases, Gainnes Cooper being just one example.