Tax on pension

catlover48

I'm due to retire in 13 months and will have a company pension of £5,400 a year can anyone tell me what percentage of tax I will pay on this ? my state pension will be approx £47 per week as I paid married women's stamp years ago before my divorce.

CIS

Have you had your sate pension looked as a divorced person ?, very few divorced people only get £47 p/w, most can get a top to 100%, providing their ex-husband had a good NI record.

At a £47 p/w state pension and £5400p/a ocupational pension , thats £7844,total income assuming that you have no other income, then on current rates, you would get £5035 tax free, be taxed at 10% on £2150 and 22% on £659 , a total tax of £360 p/a

catlover48

Thanks CIS, I've had this £47 quote from Newcastle, I lived abroad and don't have enough contributions, even taking my ex's into account. I was just trying to work out how much I'd have to live on and didn't know if the pension was taxed at 22%. thanks again.

CIS

I usually ask people because I used to work at State Pension Forecasting ,dealing with widows and divorcees and found that a lot of people , suprisingly, dont realise they can claim a higher pension as divorced and just put themselves on the form as single.

The other thing I would point out is that the forecasts produced at State Pension Forecasting only include UK contributions, depending on where you lived then at pension age , you may find out that you can use some of the contributions paid abroad to further your UK pension , unfortunately these details cannot be provided by State Pension orecasting, although Overseas Forecasting also at Newcastle, but part of HMRC, may be able to advse further.

caveat_emptor

CIS wrote:

Have you had your sate pension looked as a divorced person ?, very few divorced people only get £47 p/w, most can get a top to 100%, providing their ex-husband had a good NI record.

At a £47 p/w state pension and £5400p/a ocupational pension , thats £7844,total income assuming that you have no other income, then on current rates, you would get £5035 tax free, be taxed at 10% on £2150 and 22% on £659 , a total tax of £360 p/a

The £47 is correct for women who did not pay the full NI stamp even if their husbands had a good NI record. If they can get a top-up to 100% let me know, I'm sure my wife would be delighted.

CIS

The 60% top up is actually up to £50.50, if the husband has a full basic state pension, £47 would only be payable as category BL pension (married womans), if the husband had less than 100% or a divorced woamn could have £47 in her own right, but depending om the circs could still claim off her ex-husband.

The 100% figure was as a divorced person claiming off their partners NI, I have dealt with many,many cases of women on £20/£30 p/w through paying the MWRRE and have managed 100% by claiming on their ex-husbands NI. The fact they paid MWRRE doesnt preclude them from receiving 100% pension as a divorcee, providing the relevant calcualtions say so.

I posted details of the relevant calcualtion in a thread yesterday.
http://forums.moneysavingexpert.com/showpost.html?p=2547408&postcount=79

It is also possible for a woman to pay MWRRE and still get a full pension on her own, providing she hasn't paid MWRRE for more than 5 yrs. A woman currently needs 39yrs for a full pension, but there are 44 yrs in her working life.

If you have a full state pension then when you reach pension age, your wife in entitled to claim the top up to £50.50 (60%) for her basic state pension.