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Not receiving State Pension after 10 years???
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# 1
abumblebee
Old 04-06-2011, 1:28 PM
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Default Not receiving State Pension after 10 years???

We are a married couple I am 75 years old and my wife 69. I have been retired for 10 years and have been receiving payments each week as Pension Credit (which we believed to be the State Pension) for both my wife and myself.


1. I recently received a letter from the DWP informing me that we had never claimed our State Pensions and we were totally unaware of this situation. It appears we never received a Pension Forecast.

2. Our concerns are: By changing to State Pension will I be liable to pay anything back?

3. How easy is this to do and does anyone have experience of this scenario?
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# 2
CLAPTON
Old 04-06-2011, 2:19 PM
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how do you come to be receiving pension credits?
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# 3
abumblebee
Old 05-06-2011, 1:06 PM
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The years leading up to retirement I was unfortunately unemployed and the benefits office automatically asked me to fill in the various forms which led me to receive Pension Credits.
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# 4
seven-day-weekend
Old 05-06-2011, 2:05 PM
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You might find they owe YOU some money as Pension Credit might be less than the State Pension you should have received.

If you have been claiming Housing and Council Tax Benefits these will also have to be reassessed.

I'm sure if you have to pay any back, then you will be able to arrive at a mutually acceptable payment plan.
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# 5
CIS
Old 05-06-2011, 2:41 PM
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If it hasn't been claimed then IIRC it defaulted to increments - this means that when you did get around to claiming it you get a slightly higher weekly amount . They did change the system a few years ago but as far as I'm aware any deferred ones from before that would remain on the increment system rather than the lump sum payment option (you may possibly be able to claim the lump sum in any case but you would need to speak to the Pension Service about this).
I work in Council Tax Recovery however my views are my own reading of the law and you should always check with the local authority in question.
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# 6
abumblebee
Old 08-06-2011, 8:52 PM
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Thumbs up 10 years and not receiving the State Pension

Thanks for taking an interest - CLAPTON

Good advice and many thanks - seven-day-wonder

CIS - Good advice and I take your advice 'on board' - thanks
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# 7
esseesee
Old 09-06-2011, 11:08 AM
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I finished a temporary job in January. I had some savings and was due for a holiday so wasn't concerned. After coming back from my holiday, I found getting a new job proved to be difficult. So I applied to start receiving my state pension (only partial as I've worked overseas for many years). Given that I hadn't been working since January, my pension credit was backdated 3 months (the maximum allowed) and my state pension begun the next week. I have just received the backdated pension credit of 137/week (as a single person) as a lump sum for the period before I started claiming my state pension; pension credit now that I am claiming my pension is somewhat less of course. I also received a lump sum as I had delayed claiming my state pension. Methinks another holiday is on the cards! I like this retirement business, I have to admit.

Whether you will be eligible for a lump sum on the basis of a deferred pension - and whether that lump sum, if received, will render you ineligible for pension credit - I cannot say, but I found the Pensions Service telephone help line staff to be that rare thing, genuinely helpful, and I doubt very much that you would have to pay anything back at all, as you have not been receiving any more than you would have received had you been claiming your state pension from the beginning.

Good luck and let us know how you get on!
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# 8
hugheskevi
Old 09-06-2011, 11:20 AM
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Quote:
I have just received the backdated pension credit of 137/week (as a single person) as a lump sum for the period before I started claiming my state pension; pension credit now that I am claiming my pension is somewhat less of course. I also received a lump sum as I had delayed claiming my state pension. Methinks another holiday is on the cards! I like this retirement business, I have to admit.
The backdated pension credit should have taken into account the State Pension you were not claiming and treated it as notional income, so I think you may have been paid too much back-dated Pension Credit that you should be aware that you might get chased for.

See page 14 of this link for further explanation of notional income.

The same rules would apply to OP, but trying to unravel 10 years of deferral and Pension Credit would be mind-bogglingly complicated so I've no idea how it would be treated in practice.
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# 9
esseesee
Old 09-06-2011, 12:02 PM
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Quote:
Originally Posted by hugheskevi View Post
The backdated pension credit should have taken into account the State Pension you were not claiming and treated it as notional income, so I think you may have been paid too much back-dated Pension Credit that you should be aware that you might get chased for.

I have it in writing from the DWP the amount that was 'owed' to me and exactly how they have worked it out. I questioned several help-line advisors thoroughly about this, and requested the explanation, amounts and calculations in written form specifically because of this possibility, which they have discounted - again in writing.
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# 10
placido
Old 09-06-2011, 3:14 PM
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Quote:
Originally Posted by esseesee View Post
I have it in writing from the DWP the amount that was 'owed' to me and exactly how they have worked it out. I questioned several help-line advisors thoroughly about this, and requested the explanation, amounts and calculations in written form specifically because of this possibility, which they have discounted - again in writing.
I am not surprised at this outcome. It has happened to other people; and there was some debate on the matter on a specialist welfare forum about a year ago.

The receipt of pension credit, you would think, would be treated as notional income and deducted from any state pension entitlement.

In fact, this does not appear to be the case. It would seem that there is a "loop-hole" in the regulations which oblige the DWP to pay (in some cases, at least) all of the state pension arrears without taking in to account the payments of pension credit.

Sounds crazy, but you got lucky; Enjoy!
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# 11
smugla
Old 28-06-2011, 11:22 PM
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Same thing happend to my dad his been on pension credit since he was 60 and didnt realise he should have had his state pension at 65 and at 68 he was offered a lump sum of 18,000 which we kept asking if he was intitled to and yes It would seem that there is a "loop-hole" in the regulations which oblige the DWP to pay all of the state pension arrears without taking in to account the payments of pension credit.this loop hile has now closed by the new goverment as they had to pay people twice !

Last edited by smugla; 28-06-2011 at 11:49 PM.
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# 12
fedupnow
Old 28-06-2011, 11:32 PM
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Quote:
Originally Posted by smugla View Post
Same thing happend to my dad his been on pension credit since he was 60 and didnt realise he should have had his state pension at 65 and at 68 he was offered a lump sum of 180000 which we kept asking if he was intitled to and yes It would seem that there is a "loop-hole" in the regulations which oblige the DWP to pay all of the state pension arrears without taking in to account the payments of pension credit.this loop hile has now closed by the new goverment as they had to pay people twice !

180,000!!!!

Bloody hell.
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# 13
smugla
Old 28-06-2011, 11:48 PM
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Originally Posted by fedupnow View Post
180,000!!!!

Bloody hell.

opps sorry i ment 18,000 thats eighteen thousand
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# 14
fedupnow
Old 28-06-2011, 11:57 PM
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Quote:
Originally Posted by smugla View Post
opps sorry i ment 18,000 thats eighteen thousand

Ah, okay.

Phew. For a few minutes I couldn't wait to retire ... 180,000 in three years, I can't wait.

Still 18 isn't to be sniffed at. Nice bit of luck there .
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# 15
placido
Old 29-06-2011, 9:38 PM
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[QUOTE=smugla;44851756]Same thing happend to my dad his been on pension credit since he was 60 and didnt realise he should have had his state pension at 65
________________________________
There was no incentive for people to claim their state pension if it was less than the pension credit that they received. People were just not aware of the (future) significance of not claiming their state pension.
____________________________________

and at 68 he was offered a lump sum of 18,000 which we kept asking if he was intitled to and yes It would seem that there is a "loop-hole" in the regulations which oblige the DWP to pay all of the state pension arrears without taking in to account the payments of pension credit.this loop hile has now closed by the new goverment as they had to pay people twice.

______________________________________

I believe it was closed as from April this year; but I dont think this is retrospective. So, if there is anyone out there who was getting pension credit before April of this year; and not claiming their state pension; they may get a lump sum for the period prior to April 2011
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# 16
smugla
Old 30-06-2011, 7:13 PM
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Yes the claim had to be made BEFORE april 2011,My dads claim started from DEC 2010 when they came to check he was on the correct benifits, Since he will get 118 state pension a week he still will get pension credit of 19 they DO not count the lump sum wich i also thought was a bit crazy

due to the fact he was on pension credit and had no savings he was taxed on 0 percent bracket and then after speeking to the HM custums due to the fact it was a deffred lump sum no tax was due if it was a error lump sum then tax had to be paid but then it can be set against another or previous tax year tottaly crazy and he dosent lose any benifits as he still recieves a credit top up !!!

Last edited by smugla; 30-06-2011 at 7:21 PM.
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# 17
placido
Old 01-07-2011, 1:27 AM
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[QUOTE=smugla;44903794]

Yes the claim had to be made BEFORE april 2011,My dads claim started from DEC 2010 when they came to check he was on the correct benifits,
-----------------------------------------------------------
That would seem to suggest that the new changes are retrospective. Did you get the impression that he would not have got the lump sum if he had claimed after April 2011??
__________________________________________________ _

Since he will get 118 state pension a week he still will get pension credit of 19 they DO not count the lump sum wich i also thought was a bit crazy
__________________________________________________ _____

Paying a lump sum to people who had received pension credit was obviously an error in legislation (which has now been corrected); but "disregarding" the lump sum payment in calculating his present pension credit is entirely within the rules. The lump sum is also disregarded for other benefits like housing benefit and council tax rebate. It does appear to be very generous on the govt's part but I can only think they are very keen to get people to defer their pensions and are providing these incentives to encourage them to do so.
__________________________________________________ ___

due to the fact he was on pension credit and had no savings he was taxed on 0 percent bracket and then after speeking to the HM custums due to the fact it was a deffred lump sum no tax was due if it was a error lump sum then tax had to be paid but then it can be set against another or previous tax year tottaly crazy and he dosent lose any benifits as he still recieves a credit top up !!!
__________________________________________________ ___

He was obviously "entitled" to the lump sum payment under the then regulations or they would not have paid it to him. Once they did pay, the lump sum would come under the same rules that apply to everybody else. Since he paid no tax on his other income then no tax was due on the lump sum.
______________________________________

Good luck to him. I hope he enjoys his "windfall".
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# 18
Oldernotwiser
Old 01-07-2011, 1:42 AM
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How can someone (male) not know that their pension is due at the age of 65?
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# 19
seven-day-weekend
Old 01-07-2011, 7:43 AM
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Originally Posted by Oldernotwiser View Post
How can someone (male) not know that their pension is due at the age of 65?
I was wondering precisely that myself!

I suppose that some people are just not very knowledgeable about these things and don't realise that 'Pension Credit' is not the same as 'Retirement Pension' - after all they both have the word 'Pension' in, don't they?

Although that just pushes the question further back and makes one wonder why a man thought he would be getting his State Retirement Pension at 60! Again, ignorance of the system, I think, and an assumption that 'they' would tell him what he should be receiving and that if 'they' don't then what he is receiving must be correct.

(Edited to add:If you read the OP's first post again, he says precisely that, he thought what he was receiving WAS his State Retirement Pension).
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Last edited by seven-day-weekend; 01-07-2011 at 7:45 AM.
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# 20
Oldernotwiser
Old 01-07-2011, 8:38 AM
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I was wondering precisely that myself!

I suppose that some people are just not very knowledgeable about these things and don't realise that 'Pension Credit' is not the same as 'Retirement Pension' - after all they both have the word 'Pension' in, don't they?

Although that just pushes the question further back and makes one wonder why a man thought he would be getting his State Retirement Pension at 60! Again, ignorance of the system, I think, and an assumption that 'they' would tell him what he should be receiving and that if 'they' don't then what he is receiving must be correct.

(Edited to add:If you read the OP's first post again, he says precisely that, he thought what he was receiving WAS his State Retirement Pension).
I can quite understand how someone can confuse Pension Credit and the state pension - although, as you say, getting it at 60's a bit of a clue!
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