State Pension Advice

ldv400

Hi All
My wife reaches 60 at the beginning of next month. She is presently in full-time employment and intends carrying on working - not sure for how long but probably another few years! She is not sure whether it is more beneficial to claim her state pension but have it deferred until she stops work or to receive it once she reaches 60. Any advice would be appreciated.
Thanks

oldandgrumpy

First thing to do is to get her a pension forecast....ie, how many years entitlement she has got. If she has a shortfall, she may be able to buy the years back.
Then google State pension or uk gov and check all the weasly words about deferment.
But remember, if you defer it and take a lump sum, the lump is income+ for that year...and is taxed!
Best of luck.

McKneff

There was an article in the Daily Mirror a few months back which
was about personal pensions and state pensions.

The upshot of it all was that you should take your privte pension whether you worked or not and defer your state pension for as long as possible as the interest rate added to this was far higher than any high interest bank.

justevi

I have just been trawling through pensions sites on this subject and this might answer your questions: http://www.thepensionservice.gov.uk/pdf/spd2/spd2sep08.pdf
Some good charts on there.

My problem is I get carers allowance which will stop if I claim my state pension and I am not sure if it is best to defer or to take my pension now and lose carers allowance. It seems normal deferment rules dont apply to me and I wont get the extra money on my pension (or lump sum) for deferring if I continue to get carers allowance. I will however get NI credits. Its all very confusing and If anyone can advise I would much appreciate it!

chesky369

justevi - your best bet is to head for your local citizens' advice bureau and ask the advisers there - just up their street.

oldandgrumpy

Hi Justevi,
We too get carers allowance, but it stops when my wife is 60 regardless of whether she defers her pension or not.

chesky369

does it get replaced by attendance allowance?

justevi

Well I am now 62 and I still get CA and havent claimed my pension so far. The way I understand it is you can carry on getting CA as long as you dont claim your pension and they credit you with extra NI contributions for the time you dont claim your pension.

McKneff

yes but i belive you have to apply for it.

EdInvestor

chesky369 wrote: »

does it get replaced by attendance allowance?

No it gets replaced by the state pension.One of the Government's more mean-minded little policies, very much in line with the thinking underlying the old state pension rules as they affect women. :mad:

millie

I believe that if your income does not go over the tax threshold in the year that you claim the lump sum for deferring your pension that no tax is payable. The amount of the lump sum is not included in the amount of income for the year in question. I also believe that you do not need to take the lump sum in the same tax year that the pension is claimed. That is the way I am reading it from the Pension deferral leaflet. I am in the 2nd year of my deferral and would be paying about £15 a week extra in tax if I was claiming my pension as I am still working part time. i am hoping to get it tax free by planning when I claim it.