UK state pension

[sugarfree]

Hello.

I'm just wondering whether there's anyone out there in the same position as myself.  I left the UK about 10 years ago and have huge gaps in my UK national insurance contributions, which means I won't be entitled to a UK state pension. 

As far as I can gather, it may be possible for me to make good the shortfall but my question is, is it worth it?  I'm 43.  Do you think by the time I retire (I intend to return to the UK in my old age), the state pension will still be a universal benefit?  My fear is that if I make up the shortfall, I'll finally get to the age of 65 or whatever and discover that the benefit is means-tested (in which case I wouldn't be eligible because I will have a (fairly) good pension from an international organisation.  I don't pay into the French Social Security system).

Anybody out there facing a similar dilemma? 

 

 

[cooperlola]

Recent legislation made 30 years the qualifying period.  As I understand it, you will need the 30 years to get a basic state pension but any extra benfits are indeed, means tested.  If you pay a voluntary contribution for 20 years, you will have enough to qualify you for the basic.  But yes, of course, things change.

I continue to pay my "stamp" on a voluntary basis because, my company pension -which I get already - notwithstanding, the extra could be very handy once I'm 64.

[powerdesal]

I am led to believe that you can qualify for the minimum pension (whatever amount that is) with a payment history of 9 years. I cant quantify / qualify that statement but I seem to remember reading/misreading something some months ago. Maybe even on this forum.

Perhaps someone else has made the necessary enquiries to UK and can give some definite info.

edit:  I assume (presume) that receipt of ANY UK state pension will qualify for an E121 (I hope)

[LisaJ]

Yes I think Steve is right. I think 30 years gives you a full state pension. I thought 13 years of contributions to qualify for the minimum pension, but this may not be right.

regards

Lisa

[londoneye]

Sugarfree - similar to you, but much worse because I haven't even thought of it ....    studying (6 years); hanging around various strange countries (including France!) - oh I don't know, about 6 or 7 years I guess.   That makes 12 or 13 years missing already.

Can't help but just wanted to say thank you for drawing my attention to this; might be worth me working out exactly how many years I have 'done' and finding out how much I would have to pay.   Add that to my list of 'get my life sorted' things !!

[LisaJ]

 I should have looked here first...

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/PensionsAndRetirement/StatePension/DG_10014671

regards

Lisa

[chessfou]

The minimum currently (at least for women - I am going on the letter my wife received recently from DWP) is 27% of UK state pension for 9 years contributions (and approx 3%/yr contrib thereafter).

30 years contributions qualify for 100% state pension (I think that was passed into law this summer).

NB: state pension is INDEX-LINKED with a current value of 100% pension (i.e. cost of buying a similar annuity) approx £140,000.

Will it ever be neans tested? Who knows but it does represent tremendous value, especially for all those who may have much of their pension in flat rate form (with average life expectancy low inflation should get close to halving the value of such pensions), so a bit of free index-linking is a real bonus.

[Jacqui Too]

Hi

 You can get a state pension forecast.

Its fairly easy but you do need to wait a little for one in the post or you can get one online, that also takes a little time as you have to receive a code so you can enter the government 'Gateway' site but it is well worth it as they also tell you whether you can pay in extra for missing years.

As I understand it if you have been a student then you may have been credited with those years!

https://secure.thepensionservice.gov.uk/statepensionforecast/

Jackie

[Benjamin]

[quote user="chessfou"]The minimum currently (at least for women - I am going on the letter my wife received recently from DWP) is 27% of UK state pension for 9 years contributions (and approx 3%/yr contrib thereafter).

30 years contributions qualify for 100% state pension (I think that was passed into law this summer).

NB: state pension is INDEX-LINKED with a current value of 100% pension (i.e. cost of buying a similar annuity) approx £140,000.

Will it ever be neans tested? Who knows but it does represent tremendous value, especially for all those who may have much of their pension in flat rate form (with average life expectancy low inflation should get close to halving the value of such pensions), so a bit of free index-linking is a real bonus.

[/quote]

A current annuity rate for a 60 year old female is £ 6,333 for £ 100,000 of fund giving an annual income of £ 8,866 based upon £ 140,000.

Surely the standard rate for a female pensioner is never that much?

[powerdesal]

[quote user="Chipie"]

Hi

 You can get a state pension forecast.

Its fairly easy but you do need to wait a little for one in the post or you can get one online, that also takes a little time as you have to receive a code so you can enter the government 'Gateway' site but it is well worth it as they also tell you whether you can pay in extra for missing years.

As I understand it if you have been a student then you may have been credited with those years!

https://secure.thepensionservice.gov.uk/statepensionforecast/

Jackie

[/quote]

I think the on line facility has been deferred until 2009 due to computer problems. Its snail mail or nothing......unless someone knows better!

[Jacqui Too]

[quote user="powerdesal"]
I think the on line facility has been deferred until 2009 due to computer problems. Its snail mail or nothing......unless someone knows better!
[/quote]

Do you mean deferred as in it was working but now it will not be available till 2009 or it has never been available? As I have had two each for myself and my OH one last year and one this year April[8-)]

Jackie

[Cat]

I thought that the on-line pension forecast was only available to those still living in the UK, and that if you lived in France you had to request a form and use snail-mail.

[chessfou]

[quote]A current annuity rate for a 60 year old female is £ 6,333 for £

100,000 of fund giving an annual income of £ 8,866 based upon £ 140,000.

Surely the standard rate for a female pensioner is never that much?[/quote]

You're looking at FLAT rates. The relevant ones are RPI:

http://www.annuity-bureau.co.uk/AF_CMS/Resources/Annuity%20bureau/rates_rpi.html

Note that the absolute best for a 60-year-old female is £3,833.04 (which is not much more than 1.4xstate pension). The fourth best is already down to £3,500.

[powerdesal]

[quote user="Chipie"]

[quote user="powerdesal"]

I think the on line facility has been deferred until 2009 due to computer problems. Its snail mail or nothing......unless someone knows better!

[/quote]

Do you mean deferred as in it was working but now it will not be available till 2009 or it has never been available? As I have had two each for myself and my OH one last year and one this year April[8-)]

Jackie

[/quote]

As in it used to work but has now been "temporarily" taken out of service until 2009. ( Or so I believe)

[AnOther]

[quote user="powerdesal"]I assume (presume) that receipt of ANY UK state pension will qualify for an E121 (I hope)[/quote]That's a very interesting point.

An E121 is issued on the basis on eligibility for a UK state pension so no eligibility = no E121

In answer to an earlier query about minimum pensions there is a BBC article here  http://news.bbc.co.uk/1/hi/business/3197943.stm  which clearly states that there is no such thing and if you have less than 25% of qualifying years you get nowt.

Of course in the UK you would get alternative benefits under the Minimum Income Guarantee (MIG) but not if in living in France.

One final point, because of a lack of sufficient contributions my wife was refused an E106 so enquired about paying for missing years and was told that any such voluntary contributions would not go towards qualifying for any E form.

[derf]

If you don't qualify for the full basic State Pension

If you don't qualify for the full basic State Pension, but have 25 per cent or more of the qualifying years, you'll get a weekly basic State Pension between the minimum (£21.83 in 2007-2008) and the maximum (£87.30 in 2007-2008).

If you have fewer than 25 per cent of the qualifying years

If you have fewer than 25 per cent of the qualifying years, you're not normally entitled to receive any basic State Pension. However, you can get a 'non-contributory' or 'Over 80 Pension' if you're aged 80 or more and meet the residency conditions. This is £52.30 a week for 2007-2008.

You can get more information from your local pension centre.

You qualify by building up enough 'qualifying years' before State Pension age.

What are qualifying years?

A qualifying year is a tax year where you have sufficient income to pay NICs (or are treated as having paid or being credited with NICs).

In 2007-2008, you need to have £4,524 or more of such earnings if you are an employee or £4,635 or more if you are self-employed.

How many qualifying years do you need?

The number of qualifying years you normally need for a full basic State Pension is equal to about 90 per cent of your working life. This is calculated from the start of the tax year in which you reach 16 until the end of the tax year preceding the year in which you reach State Pension age.

Working life

Your working life is the period over which you have to have met the contribution conditions for the basic State Pension. It is normally:

    * 49 years for men

    * 44 years for women born on or before 5 October 1950

    * 45 years for women born on 6 October 1950 or on any day through to and including 5 October 1951

    * 46 years for women born on 6 October 1951 or on any day through to and including 5 October 1952

    * 47 years for women born on 6 October 1952 or on any day through to and including 5 October 1953

    * 48 years for women born on 6 October 1953 or on any day through to and including 5 October 1954

    * 49 years for women born on 6 October 1954 or later

Your working life is counted from the start of the tax year in which you reach the age of 16 to the end of the tax year before the one in which you reach State Pension age.

Pension Forecasts

The Department for Work and Pensions provides a pension forecasting service to customers in both Great Britain and Northern Ireland. Unfortunately, the Department is temporarily unable to provide customers who reach State Pension Age on or after 6 April 2010, with a State Pension forecast. This is because the computer systems used to provide State Pension forecasts are in the process of being updated to reflect the recent changes to the State Pension rules introduced by the Pensions Act 2007.

Please note that while the Pensions Act 2007 applies only to Great Britain, it is intended that Northern Ireland, which has its own body of pensions legislation, will make corresponding provision for its customers in due course.

Over the next year we will be updating the computer systems used to provide State Pension forecasts, to enable us to provide a service that will be available to all to use. We aim to have the system changes in place by Autumn 2008.

[chessfou]

I mentioned above the current value of a UK state pension (£140,000) but for those of us here in France (or other country covered by E121) the value is far, far greater. With average life expectancy of ca. 79 years (and rising), we can add on the value of 14 years' health cover.

[Panda]

Does anyone know what the qualification for french state pension is in years?  I know that many on here have said they won't get anything despite paying  into the system for a number of years but am interested to know the facts.

[Panda]

Edit forum having a funny five minutes

[londoneye]

I've just actually found a 'forecast' I received in 2006.   However, it forecasts my pension on the assumption that from that point forth I will continue to work until retirement age (65 in my case).  

If, when system is up and running again, I ask for a further forecast, is it possible to receive a forecast of what my pension would be if I never worked again in the UK, from this point in time, does anyone know, or is the forecast only available using the 'work until retirement' scenario ?

 

[dolly daydream]

The forecasting computer system is not working for those who retire in the following circumstances.  I quote "If you reach State Pension age on or after 6 April 2010 you will not be able to receive a forecast of any type as the IT systems used to produce the forecasts are being updated to take account of the changes introduced by the Pensions Act 2007".  So those due to reach retirement age before this can still get a forecast.  This was in a letter from HM Revenue & Customs dated 30 August 2007.  It goes on to say "However, if you wish to receive this information please phone: +44 191 203 7010 if you are calling from abroad.

Also, if you have been paying voluntary contributions since 25 May 2006 and you are well over the 30 years mark you may be entitled to a refund.

[cooperlola]

When the 30 year rule was originally being discussed (before the statute) the Revenue wrote to us and said :

""you should seriously consider whether you should delay further Class 2/3 contributions until it is clear whether the rules will change.  If you decide that you  want to continue to pay, you might not be able to get a refund if it turns out that you need not have paid them." 

So don't be too sure that you'll get a refund on overpayments!

[londoneye]

So, on that basis, as I have 18 years left until retirement, and I have already (roughly worked out) paid in around 19 years of contributions (not counting 6 years studying, as I cannot find any information on the pensions website relating to this).   Thus, if I work for next few years on a temporary basis in UK for a couple of months, as long as I earn more than 4,500 (ish) each year, then I will continue to accrue qualifying years.       Then I can look at the short-fall, which will hopefully be under 10 years by that time, and make a decision on paying up.

Also I appear to have £23.70 extra a week in the forecast which I have dug out, as additional state pension.   However, I assume this will no longer apply by the time I retire, as I am unlikely (on the scenario above) to be at the higher level of income to which I assume this relates.

Am I correct ???

[cooperlola]

Or Londoneye, you can pay a voluntary stamp for 11 years to bring you up to the 30, should you not be working.

[powerdesal]

[quote user="ErnieY"]

[quote user="powerdesal"]I assume (presume) that receipt of ANY UK state pension will qualify for an E121 (I hope)[/quote]That's a very interesting point.

An E121 is issued on the basis on eligibility for a UK state pension so no eligibility = no E121

In answer to an earlier query about minimum pensions there is a BBC article here  http://news.bbc.co.uk/1/hi/business/3197943.stm  which clearly states that there is no such thing and if you have less than 25% of qualifying years you get nowt.

Of course in the UK you would get alternative benefits under the Minimum Income Guarantee (MIG) but not if in living in France.

One final point, because of a lack of sufficient contributions my wife was refused an E106 so enquired about paying for missing years and was told that any such voluntary contributions would not go towards qualifying for any E form.

[/quote]

Its still an interesting question. I read the BBC article plus the post after yours as meaning :-

Less than 25% no pension and no e forms beit 106 or 121.

Greater than 25%, reduced pension and E forms ????????????

Both I and my wife have greater than 25% but less than 100%, we should find out the answer in November, at least as far as my wife is concerned.