starting amount - new pension

SimpleMind222

Hello, I have a new state pension statement. I cannot see the words "starting amount" on it. If I do not pay any more contributions, is the "starting amount" the same thing as "Estimate based on your NI record up to 5 April 2016"?


Thank you.
(first post - I hope this is in the right place)

molerat

Yes but the figure is now at the 2017 inflation uprated amount. You need to divide that by 1.025 to get the actual 2016 "starting amount".

SimpleMind222

Thank you molerat. Will that amount be what I actually get? (subject to future adjustments for general inflation etc). Main concern is that I still don't understand if they will deduct the COPE amount from it before paying it to me. (the COPE amount on my statement is £16.64).

xylophone

What exactly does your statement say?

SimpleMind222

"Estimate based on your National Insurance record up to 5 April 2016 £128.60 a week"
and beneath that it says:
"Contracted Out Pension Equivalent (COPE). Your COPE amount is £16.64 a week"

My question is - if NO more years contributions are made after April 2016 will I be due to get the £128.60 (or roughly thereabouts adjusted for future inflation etc) or will it be £128.60 LESS £16.64. That is my main question. (I understand that there is also a question about making further contributions to improve it, but I just want to clarify the question above here). Thank you for this.

Dazed_and_confused

Out of interest what makes you think the COPE amount would be deducted?

SimpleMind222

I thought the cope amount gets deducted from your basic amount because you paid less NI during those years.. If my basic amount is listed as approx £128.60 then is that what gets COPE taken off of it, OR is that the figure AFTER they have already taken COPE off?

molerat

Neither. The starting amount is the higher of the old system (x 30ths + S2P) or new system (x 35ths - COPE) calculated at April 2016. That figure is your base amount going forward and what you will receive, plus inflationary uplifts, if no more contributions are made. The COPE figure was only ever used in that calculation and has no bearing on anything in the real world.

SimpleMind222

Thanks molerat. So are you saying my "starting amount" is the £128.60 (however they arrived at it) and will not have the £16.64 taken off it?

Tom99

SimpleMind222 wrote: »

Thanks molerat. So are you saying my "starting amount" is the £128.60 (however they arrived at it) and will not have the £16.64 taken off it?

[FONT=Verdana, sans-serif]Yes that's right but depending how far you are away from retirement age you may be able to make voluntary NI contributions which is a very good way of increasing you state pension towards the new higher level.[/FONT]

xylophone

At 6/4/16 the following calculations were done

Your qualifying years/30 + (Additional State Pension - Contracted Out Deduction).

Your qualifying years/35 - COPE. (Rebate Derived Amount)

Your starting amount was the higher of the two.

See https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/447195/new-state-pension--effect-of-being-contracted-out.pdf

but for BSP insert £119.30 and for NSP £155.65.

See also

https://www.royallondon.com/Global/documents/GoodWithYourMoney/TOPPING-UP-YOUR-STATE-PENSION-GUIDE.pdf

The COPE (Rebate Derived Amount) was used only in the calculation above to determine your £128.60 starting amount.

Does your statement mention contributions to increase the pension?