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State pension deferral??? help needed please

Hi folks am hoping to pick your brains as this is something I know very little about and any help will be most appreciated


My aunt is trying to claim state pension for her partner who was 68 in Sept. She is lucky to have been in the position not to need it up to now


when she applied she got a letter asking if she wanted to defer for 2 years. she had sent the form back saying no as her partner isn't in the best of health so the lump sum would be of a greater benefit to her than extra each week.


someone from the pension service contacted her to say that she would be better to defer as this would mean she would get a greater lump sum.


does anything have any experience of this - have I taken it up completely wrong and she would be better deferring


Thanks in advance
Comp Wins 2011 : Cant wait to start listing everything:j:j:j
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Comments

  • kidmugsy
    kidmugsy Posts: 12,709 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    Yes, she'd get a bigger lump sum by deferring BUT the lump sum just equals the income forgone, with interest applied at (currently) 2.5% p.a.

    By the way, if "partner" is a smarmy word for husband, or civil partner, you should say so. It can be relevant.
    Free the dunston one next time too.
  • xylophone
    xylophone Posts: 45,426 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    My aunt is trying to claim state pension for her partner

    I can't quite fathom what is going on here. Is the partner her husband/civil partner?

    Is this the partner's own pension that is being claimed? If so, why is the partner not doing the claiming?

    Or is the case that your aunt has now reached her own state pension age and is trying to claim on her partner's contributions?
  • sorry I should have been more specific
    her partner is not in great health so my aunt deals with all his affairs


    i had had a quick look and had thought that if they deferred by 2 years they would be saying they didn't want to be paid the lump sum for 2 years and would receive a higher weekly payment instead. I assume this isn't the case?
    Comp Wins 2011 : Cant wait to start listing everything:j:j:j
  • Linton
    Linton Posts: 17,935 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Hung up my suit!
    Sorry - I am confused. The partner who is 68 hasnt drawn his pension yet (I assume). Does he want to get the lump sum now, in which case presumably its the lump sum for 3+ years not 2 or is it for 2 further years?

    AIUI you defer by simply not claiming the pension, then when you want to take the pension you have the option of a lump sum of higher pension. When I looked at it the higher pension is more valuable than the lump sum, but of course in same cases the lump sum is more useful.
  • xylophone
    xylophone Posts: 45,426 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    edited 11 January 2014 pm31 5:28PM
    my aunt deals with all his affairs

    She has Power of Attorney or is a nominated person to deal with the partner's affairs? If not, I don't quite understand how it is permitted for the DWP to discuss the partner's financial affairs with her? At all events, she is not getting a greater lump sum or indeed anything else, the partner is.

    I don't quite understand the telephone call from the DWP - presumably, if a person wishes to claim the deferred pension then he/she should be allowed to do so without further ado and can choose the lump sum or increased weekly pension again without further ado?

    http://www.nidirect.gov.uk/state-pension-deferral-taking-up-your-state-pension-later
  • jackyann
    jackyann Posts: 3,433 Forumite
    If aunt's partner is 68 then he has been eligible since 65, and has, we infer, already deferred.
    If he is not in the best of health he may be better taking the lump sum rather than the higher pension.
    And yes, the status of their relationship matters - as I *think* lump sums from deferment can only be paid to spouses / civil partners, although on death, some can be paid into the estate.
    OP, I think you need to look up the details about pension deferment on gov.uk; and if you are not sure, then contact an organisation that can help talk your aunt through the options: CAB; Age UK; a local carers' or wlefare organisation.
  • I don't really know what her status is - he isn't able to communicate very well as he had had a stroke etc so i know she deals with everything on his behalf - of course i realise that its her partner who is due the pension its just that my aunt asked me (as obv being a civil servant i know about every aspect of every gov dept lol) for help so was trying to find out. I may have to try to call them on Monday. The online guidance is far from clear - i would have thought they would have clearer advice to be honest (especially considering its older people who will be needing advice on these matters).
    As he isn't in great health having the lump sum would def be what i would be suggesting for her to apply for as the higher weekly payment would not make much of a difference for her (she is in a lucky position financially hence why she is only looking into this now)


    i don't really understand the pension service contacting her either seems a little odd to me.
    Comp Wins 2011 : Cant wait to start listing everything:j:j:j
  • Hi folks am hoping to pick your brains as this is something I know very little about and any help will be most appreciated


    My aunt is trying to claim state pension for her partner who was 68 in Sept. She is lucky to have been in the position not to need it up to now


    when she applied she got a letter asking if she wanted to defer for 2 years. she had sent the form back saying no as her partner isn't in the best of health so the lump sum would be of a greater benefit to her than extra each week.


    someone from the pension service contacted her to say that she would be better to defer as this would mean she would get a greater lump sum.


    does anything have any experience of this - have I taken it up completely wrong and she would be better deferring


    Thanks in advance

    Firstly the Pension Service will want to know the date that the pension is being claimed from, if it is being claimed from September 2013 (the 68th birthday) there would be no further communication they would simply start paying the pension and a deferral letter would be sent out giving options as to what the lump sum would be and the extra weekly amount - tick the option you want and send it back.

    I'm guessing that that the issue has come with the start date of the pension being claimed, either missing or wanting to backdate for more than 12 months - in this scenario the Pension Service would have to get in contact to clarify when they wanted the pension to begin.

    If you ask for the claim to be paid from September 2012 any arrears would be paid from that date with no interest, the deferred period would start from 65th birthday to September 2012 if you understand what I mean.
  • whiteknight - thanks for that


    As far as i know she had put on the letter that she wanted it to be paid from his 65th birthday. i.e to receive 3 years worth of pension at the normal pension rate.


    When the man contacted her she says he told her she is better to have the pension paid from now and to defer up to 9th jan (when he called) and to write them a letter to confirm that.


    if she does that does she still get a lump sum for the period before.


    Im sorry if I'm sounding totally thick :)
    Comp Wins 2011 : Cant wait to start listing everything:j:j:j
  • Linton
    Linton Posts: 17,935 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Hung up my suit!
    whiteknight - thanks for that


    As far as i know she had put on the letter that she wanted it to be paid from his 65th birthday. i.e to receive 3 years worth of pension at the normal pension rate.


    When the man contacted her she says he told her she is better to have the pension paid from now and to defer up to 9th jan (when he called) and to write them a letter to confirm that.


    if she does that does she still get a lump sum for the period before.


    Im sorry if I'm sounding totally thick :)

    Either I or you or your aunt are very confused. If he is 68 now how can he claim pension from his 65th birthday????

    If he hasnt claimed pension from 65 til now there are two options. One is to take a taxable lump sum consisting of what he would have got from 65 til now when he is 68 (3+ years) with a bit of interest or to take an increased pension from now (increased by approx 30% beyond the current standard rate).
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