Inheritance of state pension top up

Be_Happy

The information on the new state pension top up scheme always has the following info:

"a surviving spouse or civil partner will be entitled to at least 50% of the additional State Pension"

Can anyone tell me what could cause the amount to be more than 50%?

PennyForThem_2

Date of birth of deceased - I am of state pensionable age and inherit 70% of deceased OH - I am eligible for SP before April 2016.


I have deferred. So on a recent forecast my SP actually is more than my NHS pension!

greenglide

Additional Pension (AP) from SERPS / S2P is also inheritable up to 70% as well.

These can all be inherited by a spouse / civil partner even if they get the new State Pension rather than the current one.

But note these are only inheritable by a spouse / civil partner, other arrangements do not count.

Be_Happy

Thanks. I did wonder if this was the case, but I know that whereas SERPS can be inherited up to 100% (in my case as husband was born in 1930) but as I understand the replacement SP2 can only be inherited up to 50%, so I wasn't sure which would apply.

This puts a different slant on my considering buying in extra. With my husband's age of 85 and my age of 68, roughly the same purchase cost would buy me only half the extra pension it would buy my husband. However, if my husband bought the extra and I were to inherit it the amount would be doubled.

This sounds terribly mercenary on my part but my husband is in poor health. Although we've been married 30 years his RAF pension which makes up most of our income, dies with him so I need to maximise any future pension income.

JezR

Graduated pension (contributed to between 1961-75) is also inheritable at 50%.

This briefing note for the House of Commons goes through the details of SERPS inheritance and why it varies between 50% and 100%, as a result of 'compensation' for maladministration by the D(H)SS for a decade or so failing to properly report a planned step change from 100% to 50%.

kidmugsy

Be_Happy wrote: »

This sounds terribly mercenary on my part

No it doesn't; it sounds as if you are considering a perfectly respectable and rational strategy. You are not exploiting a loophole, you are using a provision.

Be_Happy wrote: »

Although we've been married 30 years his RAF pension which makes up most of our income, dies with him

That is up-to-date info, is it?

molerat

Due to the marriage (probably 1985) being after he left the service the widow's pension would only be payable on service after 1978 at which time he would have been 48 so a fair chance he had left service by then.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/408254/37284_MMP114_Web_Accessible.pdf

kidmugsy

Be_Happy wrote: »

I need to maximise any future pension income.

If you can afford it, you could "buy" some extra pension for yourself by suspending ("deferring" they call it) your own State Retirement Pension.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/372517/dwp024-102014.pdf


P.S. In your shoes I'd check with The Pension Service that you will be able to "inherit" all 100% of your husband's top-up.

PennyForThem_2

As the OP is 68 she may already be taking SP. However, OP, you can still defer it even if you have started taking it.

Be_Happy

Thanks folks

Yes, I did defer my pension for 3 years and got the 30 per cent increase.

As for OH RAF pension . He did 30 years but left in 1977. He had already divorced by the time we met. He had paid extra to get an increased widow pension but did not read the details that pension was only payable if marriage took place while in service. He always believed that I was covered and by the time we discovered it would not apply, his health was too poor to get life insurance.

Thanks for your helpful info.

Be_Happy

Well, so much for contacting the DWP. OH e-mailed, emphasizing that he was asking about the new scheme this year where it was possible to pay a lump sum to buy extra pension. Here's the reply he received.

"Thank you for your email regarding buying extra State Pension. This is only available to people who do not have 100% Basic Pension and I am pleased to advise you that you have 100% Basic Pension. The inherited amount of your State Pension if you predecease your wife, inheritance from your State Pension will be Basic Pension 100% Pre and Post 97 Additional Pension 100%, Post 02 Additional Pension, Graduated Retirement Benefit and Contracted out Deductions 50%."

Surely the first part is wrong about only available when you don't already have a full basic pension.

The second part was very helpful, although I don't understand the COD reference.

I thought I had grasped the basics of COD but not sure now, especially as regards inheritance. Below is extract from OHs pension statement.

Basic State pension £115.95
Pre 97 additional State Pension £72.25 less COD of £30.70 = £41.55
Graduated Retirement Benefit £4.78
Age Addition £0.25
Amount each week is £162.53

Can anyone throw any light on COD inheritance?