UK pensions

[nong38]

Need to keep an eye on the tax simplification front. HMRC are looking to apply a more income tax system to national insurance contributions and is seen as a step towards combining the two into one tax in the future which might not be good for people who dont pay national insurance, like me and you. Nothing is happening right now, but this would be the first step so keep em peeled and ears to the ground.

Next wednesday is the UK budget, should be live on the BBC website about 1930/2000 fur us as a kick off time.

[denby45]

 

I had a statement from uk from the " pension forecast dept" in Newcastle which stated I have 3O Qualifying years NI contributions, which gives me a state pension of £133 per week.If I want the higher rate of £156 I can add another £23 per week for the next 10 years. So basically I would get a return of the exact same amount I contribute in that time.

 

I think you misread something. 1. You only need another 5 years to get your full pension. 2. Voluntary contribution is not 23 quid.

Den

[partington]

 

I had a statement from uk from the " pension forecast dept" in Newcastle which stated I have 3O Qualifying years NI contributions, which gives me a state pension of £133 per week.If I want the higher rate of £156 I can add another £23 per week for the next 10 years. So basically I would get a return of the exact same amount I contribute in that time.

 

I think you misread something. 1. You only need another 5 years to get your full pension. 2. Voluntary contribution is not 23 quid.

Den

Exactly-he has misunderstood completely. You only need 35 years contributions to earn the full pension amount.

Class 2 voluntary contributions (paid from abroad if you are currently working) are £2.80 a week

Class 3 voluntary contributions (paid from abroad if you are unemployed) are £14.10 a week.

If you have gaps in your record you can pay for past years that you missed from 2006 to now at slightly reduced rates

(around £2.65 per week class 2, or around £13.25 for class 3).

For most people this is one of the cheapest forms of pension you can buy and is worth careful consideration - but only if you get the facts right!

[kingalfred]

its in black and white. See part of the letter £22.99 per week to get £156 pension. And I have 30 years contributions

[evadgib]

I'd need a neck like an Owl to be able to read that Alf

HMRC advised me 2 years ago to wait until next month before contacting them. I will publish their reply in due course.

[partington]

It's hard to tell what that says because you haven't included all the text in your picture -I hope it's not missing on purpose!

Even so it is plain that it is telling you that you are going to get £22.9 per week because you were contracted out of the supplementary second pension state system, (SERPS) and were paying into that other scheme.

It is NOT telling you you have to PAY £22.9, it is telling you that you will RECEIVE £22.9 a week because of this scheme. And it is not telling you you have to pay 40 years' contributions either.

I suggest you re-read the letter and do some Googling to understand what you have really been told in this letter.

EDIT: to help you start https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/498559/your-state-pension-statement-explained-dwp042.pdf

"How does this affect the amount of State Pension you get?

It is important to note that if you have been contracted out you paid lower NI contributions or some of your NI was paid to your private pension scheme instead, so you gave up some State Pension in return. This means that the amount of State Pension you get from the Government (shown on page 1 of your statement) is lower than that for people with similar circumstances who were not contracted out.

However, the pension you get from your workplace or personal pension scheme for the periods you were contracted out, should include an amount that, in most cases, will be at least the equivalent of the additional State Pension you would have got if you had not been contracted out. It could be even higher.

We have included the current estimated value of this amount - we call this your Contracted Out Pension Equivalent (COPE) - on page 1 of your statement."

Edited March 10, 2016 by partington

[kingalfred]

Read the previous post.it tells me I will get 133 and I can get 156 by paying 22.99 a week . I called and its confirmed. All this is factual and not opinion gossip

[sunnyjim5]

Read the previous post.it tells me I will get 133 and I can get 156 by paying 22.99 a week . I called and its confirmed. All this is factual and not opinion gossip

If that is what you understand and believe it would seem there is a choice to make.

However, opening the link partington provided may prove advantageous if read and understood.

[sumrit]

Read the previous post.it tells me I will get 133 and I can get 156 by paying 22.99 a week . I called and its confirmed. All this is factual and not opinion gossip

From the image you've added kingalfred it doesn't say that by paying £22.99 a week your pension will be increased to £156.

What it says it that your state pension will be £133. It goes on to say for the period you were contracted out of the Government scheme the DWP estimates that you should receive a further pension from that contracted out scheme (COPE) OF £22.99.

Add those two payments together and your total pension should then be £156.

[partington]

Read the previous post.it tells me I will get 133 and I can get 156 by paying 22.99 a week . I called and its confirmed. All this is factual and not opinion gossip

The letter doesn't say that, and you weren't told that by HMRC. If you thought you were you were mistaken.

There comes a point where it's futile to go on, but I will have one final try. In your letter it calls the amount you think you have to pay the COPE.

In the latest HMRC guidelines to the new pension system starting April 2016 it says:

"How do you get paid your Contracted Out Pension Equivalent (COPE) amount?

The COPE amount will be paid as part of your workplace or personal pension scheme(s). It will usually be just part of your total pension bene ts under the scheme and it is not normally identi ed separately."

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/498559/your-state-pension-statement-explained-dwp042.pd

Now, you are insisting that an amount specified by the HMRC own guidelines booklet as going to be paid to you is actually an amount you have to pay them , and, even though I'm quoting from the newly published UK government website guide, that this is just gossip and rumour.

I think you just have to admit to yourself that you were mistaken and try to take in what HMRC are ACTUALLY telling you in your letter.

[partington]

Link in post above should be

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/498559/your-state-pension-statement-explained-dwp042.pdf

(Final "f" was missing)

[evadgib]

Dear ICBP supporter,

I am writing to you to ask for your help. One of our supportive MPs, Ian Blackford, is tabling a special Early Day Motion (EDM) in the House of Commons. This EDM is to pressure the Government into cancelling the upcoming regulation that would freeze our pensions for another year. It is an ideal opportunity for us to make the frozen pension injustice visible in Parliament, and if we get enough supporters, perhaps even cause a debate on the topic.

What we are asking you to do is to contact as many UK MPs as possible, either by email, letter, phone, or twitter, and urge them to sign the EDM to show support for the motion. The Government regulation will be effective April 11. 2016, so we only have the rest of March to lobby MPs to sign the EDM
You can see a list of MPs by following this link
http://www.parliament.uk/mps-lords-and-offices/

The EDM to be signed is EDM 1235, and the text of the EDM is as below

That an humble Address be presented to Her Majesty, praying that the Social Security Benefits Up-rating Regulations 2016 (S.I., 2016, No. 246), dated 25 February 2016, a copy of which was laid before this House on 1 March 2016, be annulled.
Even if you only send one Email to 1 MP, that will help. The more you can do, the better.

Thank you for your support. This is important for the cause.

Sheila Telford
Director, ICBP

Edited March 11, 2016 by evadgib

[Eclipse]

Not my MP but sent a E Mail to Diane Abbott.

Stressing the hardship caused to Immigrants returning to Africa and Caribbean to retire.

Africa and Jamaica are listed as her special interests.

Edited March 11, 2016 by Eclipse

[steve187]

It's hard to tell what that says because you haven't included all the text in your picture -I hope it's not missing on purpose!

Even so it is plain that it is telling you that you are going to get £22.9 per week because you were contracted out of the supplementary second pension state system, (SERPS) and were paying into that other scheme.

It is NOT telling you you have to PAY £22.9, it is telling you that you will RECEIVE £22.9 a week because of this scheme. And it is not telling you you have to pay 40 years' contributions either.

I suggest you re-read the letter and do some Googling to understand what you have really been told in this letter.

EDIT: to help you start https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/498559/your-state-pension-statement-explained-dwp042.pdf

"How does this affect the amount of State Pension you get?

It is important to note that if you have been contracted out you paid lower NI contributions or some of your NI was paid to your private pension scheme instead, so you gave up some State Pension in return. This means that the amount of State Pension you get from the Government (shown on page 1 of your statement) is lower than that for people with similar circumstances who were not contracted out.

However, the pension you get from your workplace or personal pension scheme for the periods you were contracted out, should include an amount that, in most cases, will be at least the equivalent of the additional State Pension you would have got if you had not been contracted out. It could be even higher.

We have included the current estimated value of this amount - we call this your Contracted Out Pension Equivalent (COPE) - on page 1 of your statement."

I'm with you on this, £133 is what he will get, £22.96 is what should be paid from his private pension, as a cope sum, ( but may not show as a seperate sum)

another 5 years class 2 or 3 will be required to achieve the full 35 year pension, as it stands his £133 is 30/35 of a full pension.

so paying £22.96 for 10 years is not on the table, but paying class 2 or 3 for 5 years is, a win win

[evadgib]

More re 1910:

http://frozenbritishpensions.org/appg-launches-parliamentary-challenge-measure-used-freeze-overseas-pensions/

[sandyf]

It's hard to tell what that says because you haven't included all the text in your picture -I hope it's not missing on purpose!

Even so it is plain that it is telling you that you are going to get £22.9 per week because you were contracted out of the supplementary second pension state system, (SERPS) and were paying into that other scheme.

It is NOT telling you you have to PAY £22.9, it is telling you that you will RECEIVE £22.9 a week because of this scheme. And it is not telling you you have to pay 40 years' contributions either.

I suggest you re-read the letter and do some Googling to understand what you have really been told in this letter.

EDIT: to help you start https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/498559/your-state-pension-statement-explained-dwp042.pdf

"How does this affect the amount of State Pension you get?

It is important to note that if you have been contracted out you paid lower NI contributions or some of your NI was paid to your private pension scheme instead, so you gave up some State Pension in return. This means that the amount of State Pension you get from the Government (shown on page 1 of your statement) is lower than that for people with similar circumstances who were not contracted out.

However, the pension you get from your workplace or personal pension scheme for the periods you were contracted out, should include an amount that, in most cases, will be at least the equivalent of the additional State Pension you would have got if you had not been contracted out. It could be even higher.

We have included the current estimated value of this amount - we call this your Contracted Out Pension Equivalent (COPE) - on page 1 of your statement."

I'm with you on this, £133 is what he will get, £22.96 is what should be paid from his private pension, as a cope sum, ( but may not show as a seperate sum)

another 5 years class 2 or 3 will be required to achieve the full 35 year pension, as it stands his £133 is 30/35 of a full pension.

so paying £22.96 for 10 years is not on the table, but paying class 2 or 3 for 5 years is, a win win

Exactly.

How do you get paid your Contracted Out Pension Equivalent (COPE) amount?

The COPE amount will be paid as part of your workplace or personal pension scheme(s). It will usually be just part of your total pension benefits under the scheme and it is not normally identified separately.

Your State Pension statement will show you how much additional State Pension you opted out of when you contracted out of the additional State Pension – your Contracted Out Pension Equivalent (COPE) amount. The COPE amount is paid as part of your private pension and not by the Government. The date when you get your workplace or personal pension, and the full amount you receive, will depend on the rules of your scheme(s) and possibly any investment choices you make. If you are unsure when you will be paid your workplace or personal pension, please contact your scheme to find out. If you are unsure of their contact details, you can use the Pension Tracing Service.

Page 13

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/498559/your-state-pension-statement-explained-dwp042.pdf

[partington]

It's hard to tell what that says because you haven't included all the text in your picture -I hope it's not missing on purpose!

Even so it is plain that it is telling you that you are going to get £22.9 per week because you were contracted out of the supplementary second pension state system, (SERPS) and were paying into that other scheme.

It is NOT telling you you have to PAY £22.9, it is telling you that you will RECEIVE £22.9 a week because of this scheme. And it is not telling you you have to pay 40 years' contributions either.

I suggest you re-read the letter and do some Googling to understand what you have really been told in this letter.

EDIT: to help you start https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/498559/your-state-pension-statement-explained-dwp042.pdf

"How does this affect the amount of State Pension you get?

It is important to note that if you have been contracted out you paid lower NI contributions or some of your NI was paid to your private pension scheme instead, so you gave up some State Pension in return. This means that the amount of State Pension you get from the Government (shown on page 1 of your statement) is lower than that for people with similar circumstances who were not contracted out.

However, the pension you get from your workplace or personal pension scheme for the periods you were contracted out, should include an amount that, in most cases, will be at least the equivalent of the additional State Pension you would have got if you had not been contracted out. It could be even higher.

We have included the current estimated value of this amount - we call this your Contracted Out Pension Equivalent (COPE) - on page 1 of your statement."

I'm with you on this, £133 is what he will get, £22.96 is what should be paid from his private pension, as a cope sum, ( but may not show as a seperate sum)

another 5 years class 2 or 3 will be required to achieve the full 35 year pension, as it stands his £133 is 30/35 of a full pension.

so paying £22.96 for 10 years is not on the table, but paying class 2 or 3 for 5 years is, a win win

Actually this isn't quite correct either.

If you contracted out of SERPS into a private scheme, which this writer did, you paid LESS NI contributions for that period than a person who didn't contract out. Therefore you get less than the full pension amount even if you have 35 years contributions.

HMRC make a deduction from your full pension amount to compensate for you not paying full NI contributions, although it's very hard to work out how they work out the how much those deductions will be.

This is explained clearly in the government guidelines I linked to above (except for how they calculate the amount they will dock you which is not explained at all, so they can get away with murder): anyway years contracted out means reduced basic pension amount, 35 years contributions notwithstanding.

[steve187]

yes if you have paid 35 years ni, you will get a full pension less the contracted out figure (COPE)

so in the quoted case the 30/35 pension which at todays figures is £156 and the COPE figure £23 will be paid by the private provider, leaving £133 state pension, ( using the letters figures) that is what i said in my quoted post.

yes it is complicated and the government have been deceitful in their claim everyone will get the full £144 (or whatever the rate will be), under the new scheme

edit text changed to make clearer

Edited March 11, 2016 by steve187

[Rajab Al Zarahni]

Our exchange of thoughts on kingalfreds letter from the DWP evidences the difficulty of comprehension that will be faced by the typical recipient of such a letter.

Is he being asked for further National Insurance contributions ? No

Is he being advised he will get some more pension ? No

He is being told that his state pension is significantly more than he thought it would be, but the amount he thinks he will now get will be paid to him by somebody else and will be subsumed in a pension he already anticipates !

Only a government agency like the DWP, in its infinite wisdom, would be capable of drafting a letter of explanation, that itself requires the recipient to pour over the probability of its meaning !.

Edited March 11, 2016 by Rajab Al Zarahni

[Rajab Al Zarahni]

I've been working on a campaign song ( Adapted from Bobby Darin: Simple Song of Freedom);

Sing a simple song of frozen pensions,

Sing it like you've never sung before !

Lets its message fill the air

Tell the people everywhere.

We the people here just want some more.

Hey there Mr Cameron are you listening ?

I don't want your licence free TV.

I just simply want to be

Treated just and equitably

It's a pity that you don't want the same.

Edited March 11, 2016 by Rajab Al Zarahni

[jpinx]

Our exchange of thoughts on kingalfreds letter from the DWP evidences the difficulty of comprehension that will be faced by the typical recipient of such a letter.

Is he being asked for further National Insurance contributions ? No

Is he being advised he will get some more pension ? No

He is being told that his state pension is significantly more than he thought it would be, but the amount he thinks he will now get will be paid to him by somebody else and will be subsumed in a pension he already anticipates !

Only a government agency like the DWP, in its infinite wisdom, would be capable of drafting a letter of explanation, that itself requires the recipient to pour over the probability of its meaning !.

What happened to the "Plain English" campaign? Everything from government is written in "obfuscate-speak" so that it can be interpreted in law, but there is no plain language alternative. And their accounting/mathematics is totally beyond comprehension - sometimes even to qualified accountants,,,,

[kingalfred]

Our exchange of thoughts on kingalfreds letter from the DWP evidences the difficulty of comprehension that will be faced by the typical recipient of such a letter.

Is he being asked for further National Insurance contributions ? No

Is he being advised he will get some more pension ? No

He is being told that his state pension is significantly more than he thought it would be, but the amount he thinks he will now get will be paid to him by somebody else and will be subsumed in a pension he already anticipates !

Only a government agency like the DWP, in its infinite wisdom, would be capable of drafting a letter of explanation, that itself requires the recipient to pour over the probability of its meaning !.

Thanks . I agree with the posts about my statement. But I asked the DWP "how can I add contributions to my NI for an increased pension"? They have not given me an estimate of what amount to add and how I can add! When I phoned it was impossible to get through to a department to advise me.All extremely frustrating.

[sunnyjim5]

Our exchange of thoughts on kingalfreds letter from the DWP evidences the difficulty of comprehension that will be faced by the typical recipient of such a letter.

Is he being asked for further National Insurance contributions ? No

Is he being advised he will get some more pension ? No

He is being told that his state pension is significantly more than he thought it would be, but the amount he thinks he will now get will be paid to him by somebody else and will be subsumed in a pension he already anticipates !

Only a government agency like the DWP, in its infinite wisdom, would be capable of drafting a letter of explanation, that itself requires the recipient to pour over the probability of its meaning !.

Thanks . I agree with the posts about my statement. But I asked the DWP "how can I add contributions to my NI for an increased pension"? They have not given me an estimate of what amount to add and how I can add! When I phoned it was impossible to get through to a department to advise me.All extremely frustrating.

https://www.gov.uk/state-pension-topup

Full details of cost and how to apply ----------

[partington]

Our exchange of thoughts on kingalfreds letter from the DWP evidences the difficulty of comprehension that will be faced by the typical recipient of such a letter.

Is he being asked for further National Insurance contributions ? No

Is he being advised he will get some more pension ? No

He is being told that his state pension is significantly more than he thought it would be, but the amount he thinks he will now get will be paid to him by somebody else and will be subsumed in a pension he already anticipates !

Only a government agency like the DWP, in its infinite wisdom, would be capable of drafting a letter of explanation, that itself requires the recipient to pour over the probability of its meaning !.

Thanks . I agree with the posts about my statement. But I asked the DWP "how can I add contributions to my NI for an increased pension"? They have not given me an estimate of what amount to add and how I can add! When I phoned it was impossible to get through to a department to advise me.All extremely frustrating.

https://www.gov.uk/state-pension-topup

Full details of cost and how to apply ----------

No this is no good:

it refers to people born before 1951 who are drawing their pension NOW.

What the Royal personage needs to do is consult this leaflet about paying NI contributions from abroad.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/414910/NI38_CF83.pdf

It has a form at the end called CF83- it is basically an application form to begin to to pay voluntary contributions from abroad. You can fill in a standing order form and start paying voluntary class 2 or 3 contributions for the current and future years this way.

There is ALSO a check box that says "please give me information about any gap years that I may have and how to make contributions": you check it.

They will then send you back a letter, reasonably understandable, showing any gap years you have in the past and how much to pay for that entire year to count as a valid year for NI purposes. You can pay for years going back to at least 2006, sometimes longer.

In the letter they send telling you what gaps you've got they don't give you any information on how to pay these back years, but sending a cheque for the amount and a letter indicating what year it is for together with your NI number and any other information they have told you in this letter should be fine, according to someone I spoke to last year at HMRC.

Edited March 12, 2016 by partington

[sandyf]

There seems to be some confusion over next years personal allowance. I posted previously that my notice of coding showed £11,000 but thought that may have been a misprint, other articles have indicated £10,800.

The £11,000 also appears on the website personal page.

Tax-free allowances Current tax year Next tax year Total tax-free allowances 10,600 >Changes to 11,000 Personal Allowance 10,600 >Changes to 11,000

[kingalfred]

But it says this only applies to those who have pension before April 2016

[Rajab Al Zarahni]

Our exchange of thoughts on kingalfreds letter from the DWP evidences the difficulty of comprehension that will be faced by the typical recipient of such a letter.

Is he being asked for further National Insurance contributions ? No

Is he being advised he will get some more pension ? No

He is being told that his state pension is significantly more than he thought it would be, but the amount he thinks he will now get will be paid to him by somebody else and will be subsumed in a pension he already anticipates !

Only a government agency like the DWP, in its infinite wisdom, would be capable of drafting a letter of explanation, that itself requires the recipient to pour over the probability of its meaning !.

What happened to the "Plain English" campaign? Everything from government is written in "obfuscate-speak" so that it can be interpreted in law, but there is no plain language alternative. And their accounting/mathematics is totally beyond comprehension - sometimes even to qualified accountants,,,,

The Sicilian mafia put a horses head in your bed and make you an offer you can't refuse.

The DWP mafia put a horses head under your bed and make you an offer you can't understand.

[sunnyjim5]

Our exchange of thoughts on kingalfreds letter from the DWP evidences the difficulty of comprehension that will be faced by the typical recipient of such a letter.

Is he being asked for further National Insurance contributions ? No

Is he being advised he will get some more pension ? No

He is being told that his state pension is significantly more than he thought it would be, but the amount he thinks he will now get will be paid to him by somebody else and will be subsumed in a pension he already anticipates !

Only a government agency like the DWP, in its infinite wisdom, would be capable of drafting a letter of explanation, that itself requires the recipient to pour over the probability of its meaning !.

What happened to the "Plain English" campaign? Everything from government is written in "obfuscate-speak" so that it can be interpreted in law, but there is no plain language alternative. And their accounting/mathematics is totally beyond comprehension - sometimes even to qualified accountants,,,,

The Sicilian mafia put a horses head in your bed and make you an offer you can't refuse.

The DWP mafia put a horses head under your bed and make you an offer you can't understand.

Given that 50% of the population are below "average IQ" and many struggle to read/comprehend the Daily Mirror it would not matter how "plain" the English in DWP communications someone would complain they could not understand !

[evadgib]

The get round that by publishing in The SUN

(This was the nearest I could find to Trig reading it!)

Edited March 13, 2016 by evadgib

[jpinx]

Whilst it is not unreasonable for the legislation to be a bit confusing to lay-people, a letter of "explanation" should be written in such a way that a single reading conveys the truth with no abiguity......