Questions on Pensions

Ladywriter1968

Myself and my husband have not got to this stage yet, we are some what younger, but I have some questions that may be answered. As time is flying by and if I am still living by then the pension age and thats why I ask now.

When we both retire, will they put both our pensions together as one or pay us separately? May seem a stupid question but I dont know any couples that are still together accept us, and most I know older are single now.

My husband works and also has a frozen private pension from his last job and paying into a pension in the one he is currently in as well and his state pension. My neighbour told me that when she worked years ago they put her state pension and her private pension together all into one and now she has to pay tax on it, because to comes over the limit. She told me she would have preferred them both kept separate but the pensions would not allow it.

I have not worked in a while due to health issues so have some short falls in my state pension. so I was thinking of paying into a private pension and did a search and found some that said you can pay into it even if you are not working.

At least I could have some top up or something when I retire. I am not claiming any benefits either as my husband works as stated above about him working. He works full time.

Just so that I can get some idea into all of this.

Thanks.

jem16

Ladywriter1968 wrote: »

When we both retire, will they put both our pensions together as one or pay us separately? May seem a stupid question but I dont know any couples that are still together accept us, and most I know older are single now.

State pensions are always paid separately. In fact all pensions are paid separately.

My husband works and also has a frozen private pension from his last job and paying into a pension in the one he is currently in as well and his state pension. My neighbour told me that when she worked years ago they put her state pension and her private pension together all into one and now she has to pay tax on it, because to comes over the limit. She told me she would have preferred them both kept separate but the pensions would not allow it.

The state pension is paid to you gross - ie with no tax taken off. However it is taxable so if your state pension plus private pension is over the Personal allowance then you will have to pay tax. Any tax due will be taken via your private pension as your tax code will have a deduction for the state pension. This is the way PAYE works but if it didn't work this way you would have a tax bill to pay at the end of each tax year which you don't want.

I have not worked in a while due to health issues so have some short falls in my state pension. so I was thinking of paying into a private pension and did a search and found some that said you can pay into it even if you are not working.

With no earned income you are able to pay £3600 gross (or £2880 net) into a pension scheme and claim 20% tax relief. This applies to all pensions.

Ladywriter1968

jem16 wrote: »

State pensions are always paid separately. In fact all pensions are paid separately.



The state pension is paid to you gross - ie with no tax taken off. However it is taxable so if your state pension plus private pension is over the Personal allowance then you will have to pay tax. Any tax due will be taken via your private pension as your tax code will have a deduction for the state pension. This is the way PAYE works but if it didn't work this way you would have a tax bill to pay at the end of each tax year which you don't want.



With no earned income you are able to pay £3600 gross (or £2880 net) into a pension scheme and claim 20% tax relief. This applies to all pensions.

Thank you for the information.....