parischic Posted October 18, 2010 Share Posted October 18, 2010 After waiting almost 7 months, I finally had a reply to my letter to the Pension Service in Newcastle! I’ve been informed that if I pay voluntary contributions of £626.60 for each of the next tax years 2011, 2012, 2013 (i.e. £626.60x 3) I’m entitled to a pro-rata State Pension of 29% (£28.32 a week). This will be increased by 10,4% for each year I delay retirement, past 60. Or I can take this as a lump sum - does anyone know how the lump sum is calculated ? Considering that the French CNAV has translated my years worked in UK as 35 “trimesters” (just 5 “trimesters” short of the 40 (10 years) required for the UK state pension, it seems a little unfair that I have to pay voluntary contributions for 3 whole years. Yes I know that the French calculate pensions in “trimesters” and the UK count full years only. I’ve thought of contacting the Pensions office to ask them to reconsider & try to negotiate a deal. Would this work ? Has anyone had a similar experience ? Thanks! Link to comment Share on other sites More sharing options...
Russethouse Posted October 18, 2010 Share Posted October 18, 2010 How much would you get if you didn't make the voluntary contributions ? Link to comment Share on other sites More sharing options...
parischic Posted October 18, 2010 Author Share Posted October 18, 2010 Nil - nada - zilch - rein du tout !!!!!! I've worked out that it may be best for me to pay the extra contributions which I'll recoup after 44 weeks. But still not totally clear yet.... Link to comment Share on other sites More sharing options...
Gardengirl Posted October 18, 2010 Share Posted October 18, 2010 It sounds a good deal to me, as it will soon be recovered! [:)] Link to comment Share on other sites More sharing options...
NormanH Posted October 18, 2010 Share Posted October 18, 2010 [quote user="parischic"]After waiting almost 7 months, I finally had a reply to my letter to the Pension Service in Newcastle! I’ve been informed that if I pay voluntary contributions of £626.60 for each of the next tax years 2011, 2012, 2013 (i.e. £626.60x 3) I’m entitled to a pro-rata State Pension of 29% (£28.32 a week). This will be increased by 10,4% for each year I delay retirement, past 60. Or I can take this as a lump sum - does anyone know how the lump sum is calculated ? Considering that the French CNAV has translated my years worked in UK as 35 “trimesters” (just 5 “trimesters” short of the 40 (10 years) required for the UK state pension, it seems a little unfair that I have to pay voluntary contributions for 3 whole years. Yes I know that the French calculate pensions in “trimesters” and the UK count full years only. I’ve thought of contacting the Pensions office to ask them to reconsider & try to negotiate a deal. Would this work ? Has anyone had a similar experience ? Thanks! [/quote]I had the opposite experience of calculation.The UK uses weeks, and France accepts only full trimestres, so my French pension fell short of what I would have received if calculated in the UK way. Link to comment Share on other sites More sharing options...
tonyinfrance Posted October 19, 2010 Share Posted October 19, 2010 The tax free element is normally 25%. It's not always clear if additional contributions make financial sense but you can do this calculation on line......... Link to comment Share on other sites More sharing options...
AnOther Posted October 19, 2010 Share Posted October 19, 2010 Are we talking at cross purposes.Since when was there a tax free lump sum element to the UK state pension ? Link to comment Share on other sites More sharing options...
idun Posted October 19, 2010 Share Posted October 19, 2010 If people defer their state pensions for a specific period they can get a lump sum, but I'm sure that it is taxable. Link to comment Share on other sites More sharing options...
John Brown Posted October 20, 2010 Share Posted October 20, 2010 One of the things that is not made clear in the letter the Pension's People send is that the amount calculated to top up your contributions is based on the NI contributions for this current year and if you defer paying ( as we did ) of the period they say you are entitled to deliberate it over, the top up contributions can rise quite steeply.In our case because NI contributions had risen sharply over the years it took us to get around to topping up the contributions and it became uneconomicMy wife would have been in her late 80's before we clawed it back. And a buck in the hand is worth..........................Its also not mentioned in the letter that the rules are changing on entitlementNow the entitlement rules have reduced down to 30 qualifying years topping up should not be required by most peopleJB Link to comment Share on other sites More sharing options...
woolybanana Posted October 20, 2010 Share Posted October 20, 2010 I always used to pay what I think were called Class 4 contributions to make up the years that were lost as I worked abroad. They used to give seven years to pay it I think. This was a few years ago now, but I calculated that the pension was worth the interest off £100,000 and therefore was a very good deal, especially when they sent back a cheque saying that the number of total contributory years had dropped to 30 and that therefore I had enough to get the full State pension. Which I shall have, inshallah, at the end of next year. Link to comment Share on other sites More sharing options...
idun Posted October 20, 2010 Share Posted October 20, 2010 We recieved a letter recently stating that my husband should continue paying voluntary contributions to cover me. The 30 years is for him, but the rules with the 40 odd years continue to cover the spouse. Link to comment Share on other sites More sharing options...
NormanH Posted October 20, 2010 Share Posted October 20, 2010 That is a very informative and highly interesting post . Link to comment Share on other sites More sharing options...
parischic Posted October 21, 2010 Author Share Posted October 21, 2010 Unfortunately I'm still no clearer about my particular case (I worked in UK sporadically from 1963 - 1979 before settling in France in 1980) so I reckon another detailed letter or email to the Pensions Office is in order ( and another 7 months wait !) As for voluntary contributions there are 2 rates : Class 3 and the cheaper Class 2, which means in order to be eligible to pay the lower rate, I have to give the name and adress of my last employer in UK before I moved to France. I'll get there in the end - just requires lots of patience! Meanwhile Im waiting till 65 to claim my French pension so as not to have a "décote" . Link to comment Share on other sites More sharing options...
Jay Posted October 21, 2010 Share Posted October 21, 2010 [quote user="idun"]We recieved a letter recently stating that my husband should continue paying voluntary contributions to cover me. The 30 years is for him, but the rules with the 40 odd years continue to cover the spouse.[/quote]Your post doesn't seem to make any sense! What do you mean by "40 odd years"? My wife recently received her state pension based on 30 years and I am due to receive mine in a couple of years based (I hope) on 30 years as well. Is there some rule I have missed based on the sex of the claimant? Link to comment Share on other sites More sharing options...
Jay Posted October 21, 2010 Share Posted October 21, 2010 [quote user="idun"]If people defer their state pensions for a specific period they can get a lump sum, but I'm sure that it is taxable.[/quote]Again there is nothing specific in your post - can you give a reference on the UK pensions site? Link to comment Share on other sites More sharing options...
sid Posted October 21, 2010 Share Posted October 21, 2010 This subject has confused me too! I got a letter from DWP asking if I wished to top-up my contributions; I currently have 41 years full contributions. Then the letter went on to tell me that the qualifying number of years is now 30.... so why would I want to buy more??? How about a refund? [:)]And while I'm getting steamed up about it, why does the governemnt reduce the number of qualifying years when it clearly can't afford to pay the pensions in the first place? surely they should be increasing the qualifying period if anything, along with raising the pension age? Link to comment Share on other sites More sharing options...
John Brown Posted October 21, 2010 Share Posted October 21, 2010 Copied from the Direct Gov WebsiteChoices you have at State Pension age State Pension age is not the same as retirement age. Retirement age is when you choose to retire, but you can still work after State Pension age.When you reach State Pension age, you can: stop working and get your State Pensioncarry on working and get your State Pension as wellcarry on working and put off claiming your State Pension If you put off claiming your State Pension, you may be able to get extra State Pension or a lump-sum payment when you do claim it.If you go on working after State Pension age, you don't have to carry on paying National Insurance contributions.JB uote] Link to comment Share on other sites More sharing options...
idun Posted October 21, 2010 Share Posted October 21, 2010 Voila!http://www.pensionsadvisoryservice.org.uk/state-pensions/deferringhttp://www.direct.gov.uk/en/pensionsandretirementplanning/statepension/statepensiondeferral/dg_10027570http://www.direct.gov.uk/en/Pensionsandretirementplanning/TaxandNationalInsuranceinretirement/GettingyourtaxandNationalInsuranceright/DG_10021384From this web pageBereavement benefits and qualifying yearsIt's important to note that if you reach State Pension age on or after 6 April 2010 eligibility for bereavement benefits (payable if someone dies to their spouse or civil partner if under State Pension age, and based on the deceased's National Insurance contributions) will remain at up to 39 qualifying years for a woman and up to 44 for a man. You may want to take this into account when deciding whether or not to top up your National Insurance contributions.And this is now a choice for us. He has already over paid on his number of years ie around 33 years now, when only 30 are needed just for the pension, so we could just continue or not. And we have decided not to.So sorry I have made the page BIG, but I just copied the links Link to comment Share on other sites More sharing options...
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