Checking my Second State Pension

DaisyM_3

I receive my state pension next month and have been told how much I will receive. However, I also do the salaries for the three companies that I work for, and have received letters from the Pensions Service asking me for info about my earnings for 2 out of the 3 companies I work for. The letters tell me they need info about my earning for 2013/14 and later and 2012/13 and earlier, as they have been unable to obtain this info from the Inspector of Taxes. This has made me somewhat suspicious that they haven't worked out my pension correctly, and I am also wondering if they have missed out the NIC I paid for my 3rd employment, as they haven't written to me about that job. How can I check that they've worked out my additional state pension pension correctly? I'm not worried about the basic pension, as I know I have been correctly awarded the full rate.

greenglide

The calculations are horrendously complex and rely on you having all of the necessary earnings data for each employment going back a long way. If you come up with a different answer (and you are guaranteed to!) there is no way to tell who is right or where the difference lies.

It is complicated by the fact that the calculation is performed, at least initially, by HMRC and the data required is maintained by HMRC.

You could start off checking your NI contributions history here https://www.gov.uk/check-national-insurance-record to see which recent years have been processed. Presumably DWP have some doubts if they are getting details from the employers?

DaisyM_3

Thanks for that info. I actually have all my earnings records, going back to 1974, but it's not too complicated as I was either contracted out or self employed until 2000, so only have 15 years to look at!

hugheskevi

I actually have all my earnings records, going back to 1974, but it's not too complicated as I was either contracted out or self employed until 2000, so only have 15 years to look at!

Be aware that even though you are contracted-out you can still accrue SERPS (eg increases on the contracted out proportion can be paid as extra SERPS) or State Second Pension (the additional State Second Pension compared to the SERPS amount which applies to low and middle earners accrues as State Second Pension).

The 3 different accrual tiers of State Second Pension (10%, 40% and 20%) are fiddly, and require looking up a lot of figures. The system has also changed even after the introduction of State Second Pension (eg the introduction of the Upper Accrual Point).

Good luck if you try to reconcile the figures - the whole system ended up being a very over-complicated mess.

agarnett

hugheskevi wrote: »

...Good luck if you try to reconcile the figures - the whole system ended up being a very over-complicated mess.

Ended-up? From what we've just started to see only quite recently, I doubt really whether we have yet reached the end of the beginning of the realisation of the complicated mess :mad:

The mess extends to the realisation of mistakes in past calculations of contracted out DB scheme entitlements too, I think?