Deferring state pension

Dazed_and_C0nfused

woolly_wombat said:

Bubble02 said:

There have a been a number of instances recently when the DHSS has paid pensioners the incorrect amount.

Yes, that happened to my other half. His deferred State Pension had been underpaid for a couple of years so check carefully! It took numerous phone calls and a threat to make a formal complaint to secure recalculation and back payment. Contacting our MP would have been the logical next step.

Those who reached State Pension age prior to 6 April 2016 are entitled to claim an additional 10.4% for each complete year of deferral.

Alternatively, you can opt for a one-off taxable lump sum.

For more details, see the government’s guide ‘Deferring your State Pension if you reached State Pension age before 6 April 2016’: 

https://www.gov.uk/government/publications/deferring-your-state-pension
.
.

The lump sum has special rules relating to how it is taxed so for some it's possible to avoid paying any tax on it at all.

But there are some traps you can fall into if you aren't careful.  Some individuals paying no tax will have to pay tax on their State Pension lump sum so best understand this fully if the lump sum if the preferred option.

https://www.taxadvisermagazine.com/article/lump-sums