Adult Dependency Increase

Daisey

My husband reaches retirement age in September 2009. After being made redundant last year he is now self-employed, and is hoping to continue working after then. He may be able to get an increase in his state pension for me as his dependent. Am I right in thinking that with the new pension reforms, if he were to defer his pension until after April 2010, he would not be able to claim anything for me at all?

My main questions are about my eligibility for the dependency increase.

What is the limit on any income I can earn to get the extra payment?

I will be 58 then and my only regular income is £119 per month from an occupational pension. However, most of our savings are in my name, as I am not a tax payer. At the moment the interest is about £2000 per year, plus about £1300 interest from a cash ISA. Would this interest be taking into account when they work out if I am eligible for the extra payment?

If so would it be best to put our savings back into my husband's name, even though he will have to pay tax on the interest, so we can get the extra £54 per week for me? When I am 60 in 2011 I will get my main occupational pension, so any extra pension would stop then.

Thanks for any advice.

Daisey

EdInvestor

http://www.dialdoncaster.co.uk/benefit/State%20Pension.html


[FONT=Verdana, Arial, Helvetica, sans-serif]Basic State Pension per week[/FONT]
[FONT=Verdana, Arial, Helvetica, sans-serif]For yourself - £90.70
For an adult dependant - £54.35
[/FONT]
[FONT=Verdana, Arial, Helvetica, sans-serif]

An adult dependant can be a wife or someone looking after your dependent child, or in limited circumstances, a husband. The age of an adult dependant makes no difference. If they are working or receiving other NI income maintenance benefits, this affects the £54.35 increase in the same way as for IB. The earnings limit for an adult dependant is £59.15, so the increase won't be paid if they earn more in any week; occupational and personal pensions count as earnings here.

[/FONT]

[FONT=Verdana, Arial, Helvetica, sans-serif]A woman can only receive an increase for her husband if, immediately before drawing a state pension, she was receiving an increase for him with IB.[/FONT]
[FONT=Verdana, Arial, Helvetica, sans-serif]If your adult dependent receives income maintenance benefits (e.g. severe disablement allowance or IB) those benefits will reduce or cancel out a dependent's increase to your state pension.[/FONT]

and

http://www.citizensinformation.ie/categories/social-welfare/irish-social-welfare-system/claiming-a-social-welfare-payment/claiming-an-increase-in-your-social-welfare-payment-for-an-adult-dependant

Daisey

Thanks Ed

[FONT=Verdana, Arial, Helvetica, sans-serif]The earnings limit for an adult dependant is £59.15, so the increase won't be paid if they earn more in any week; occupational and personal pensions count as earnings here. [/FONT]

I think this is now £60.50.

http://www.citizensinformation.ie/ca...dult-dependant

This seems to be an Irish site.

Can anyone answer my question about whether they take into account any interest from savings? I have looked at the form you have to fill in to claim the extra pension, and it doesn't say anything about interest, but it does have a page for any other income.

Thanks
Daisey

EdInvestor

Daisey wrote: »

Am I right in thinking that with the new pension reforms, if he were to defer his pension until after April 2010, he would not be able to claim anything for me at all?

Looks like it.

http://www.ageconcern.org.uk/AgeConcern/Documents/FS19The_State_Pension.pdf

Would this interest be taking into account when they work out if I am eligible for the extra payment?

No mention of savings income on the above link, but suggest you follow up with Age Concern.

astrogeezer

I have been informed by HM Pensions that ADI is not means tested. This effectively means that any interest earned from personal savings is NOT taken into account when calculating entitlement to ADI. So even if you're working and earning less than £3050 pa, your spouse is entitled to claim ADI for you regardless of any extra income you may have from interest from savings.

Consequently I am therefore now in receipt of ADI.

As confirmation, at no point during the application, either written or verbal, was I asked whether my wife had any savings of her own.

Tony_Pensions_Issues

I have spent an extended period searching and asking the Pension Service whether or not unearned income is added to spouse's earned income and spouse's pension income in calculating entitlement to Adult Dependency Increase (ADI). Nobody provided a definitive answer. Today I think I finally cracked it! The Explanatory Notes to the Pensions Bill, 19th April 2007 [HL Bill 61], paras 36 – 38 read:

++++++++

[FONT=CMGIPF+TimesNewRoman]Category A and C retirement pensions: abolition of adult dependency increases [/FONT]
[FONT=CMGIHB+TimesNewRoman]Current position [/FONT]
[FONT=CMGIKC+TimesNewRoman]36. Adult dependency increases are payable in respect of a ‘dependant’ who: [/FONT]
[FONT=CMGIKC+TimesNewRoman]a) does not have earnings or an occupational or personal pension of more than a prescribed amount (generally £57.45 per week, but different rules apply where the dependant does not live with the pensioner); and [/FONT]
[FONT=CMGIKC+TimesNewRoman]b) is not receiving pension or benefit in his or her own right at a rate equal to or greater than that of the adult dependency increase (generally £50.50 per week, but a lower rate is payable where the pensioner does not fully satisfy the contribution conditions for basic state pension). [/FONT]
[FONT=CMGIKC+TimesNewRoman]37. Adult dependency increases of state pension are currently payable in respect of the following, providing they meet the criteria set out above: [/FONT]

[FONT=CMGIKC+TimesNewRoman]• [FONT=CMGIKC+TimesNewRoman]A wife; [/FONT][/FONT]
[FONT=CMGIKC+TimesNewRoman]• [FONT=CMGIKC+TimesNewRoman]A husband – providing his wife was receiving an adult dependency increase of incapacity benefit in respect of him immediately before she reached state pension age; and [/FONT][/FONT]
[FONT=CMGIKC+TimesNewRoman]• [FONT=CMGIKC+TimesNewRoman]A person having care of the pensioner’s child/ren. [/FONT][/FONT]

[FONT=CMGIKC+TimesNewRoman]38. As an adult dependency increase in respect of a wife is payable at the same rate as a Category B pension there is no financial advantage in a man continuing to claim an adult dependency increase in respect of his wife once she has attained state pension age. [/FONT]
[FONT=CMGIKC+TimesNewRoman]+++++++++++++++++[/FONT]
Obviously, the actual rates have changed since this publication.

So unearned income is not taken into account!

Since I cannot include the link, simply Google WITH THE QUOTES:

"Adult dependency increases are payable in respect of"

To locate the parliament publication

Hope this helps others.