self employed deferred pension

jenny188

Help Please! I reached state pension age on 23/5/22 and deferred my pension for a year. I am retiring on the 28th April 2023 (self employed courier) and want to claim my pension and lump sum on 23rd May 2023. Will I be taxed heavier on my lump sum because I have worked for the first four months of the year? I can't seem to find any definitive answers online and would appreciate any help. Thank you.

Dazed_and_C0nfused

What lump sum?

Deferred state pension lump sums are only available to people reaching State Pension age before 6 April 2016.

Linton

What do you mean by your "lump sum"?

I  guess you are talking about a DB ("final salary") pension from a previous employer which pays a tax free lump sum in addition to the pension.  This is obviously tax free so no tax is due or taken.

On the other hand if you are talking about a payment because you deferred your state pension then you dont get a lump sum but rather an extra 1% State Pension for each 9 weeks you defer.

jenny188

Oh, OK. I was under the impression that if I deferred for 1 year I could claim a lump sum. I must have misread. Thanks.

Dazed_and_C0nfused

You can backdate your claim and get a lump sum (that is totally different to deferral).

But I presume you would then lose the 1% additions you've been accruing.

https://www.gov.uk/deferring-state-pension/what-you-get

Linton

Dazed_and_C0nfused said:

You can backdate your claim and get a lump sum (that is totally different to deferral).

But I presume you would then lose the 1% additions you've been accruing.

https://www.gov.uk/deferring-state-pension/what-you-get

Do you have any authoritative reference for backdating the post 2016 SP for 12 months as opposed to deferring?   It does not seem to be mentioned in the reference you give.  Google has found nothing on the gov.uk website. 

Dazed_and_C0nfused

Linton said:

Dazed_and_C0nfused said:

You can backdate your claim and get a lump sum (that is totally different to deferral).

But I presume you would then lose the 1% additions you've been accruing.

https://www.gov.uk/deferring-state-pension/what-you-get

Do you have any authoritative reference for backdating the post 2016 SP for 12 months as opposed to deferring?   It does not seem to be mentioned in the reference you give.  Google has found nothing on the gov.uk website. 

There's more detail here.

Not gov.uk but I think it's a decent source.

https://www.turn2us.org.uk/Benefit-guides/New-State-Pension/How-do-I-claim-New-State-Pension#guide-content

xylophone

You reach SPA after 6/4/16.

https://www.gov.uk/deferring-state-pension/what-you-get

If you read the above, you will note that it is only those who reached SPA before 6/4/16 who had the lump sum option.

If you reach State Pension age on or after 6 April 2016

Your State Pension will increase every week you defer, as long as you defer for at least 9 weeks.

Your State Pension increases by the equivalent of 1% for every 9 weeks you defer. This works out as just under 5.8% for every 52 weeks.

The extra amount is paid with your regular State Pension payment.

Linton

Dazed_and_C0nfused said:

Linton said:

Dazed_and_C0nfused said:

You can backdate your claim and get a lump sum (that is totally different to deferral).

But I presume you would then lose the 1% additions you've been accruing.

https://www.gov.uk/deferring-state-pension/what-you-get

Do you have any authoritative reference for backdating the post 2016 SP for 12 months as opposed to deferring?   It does not seem to be mentioned in the reference you give.  Google has found nothing on the gov.uk website. 

There's more detail here.

Not gov.uk but I think it's a decent source.

https://www.turn2us.org.uk/Benefit-guides/New-State-Pension/How-do-I-claim-New-State-Pension#guide-content

Yes I found that one and something similar at https://www.rights4seniors.net/content/claiming-state-pension-0 but was looking for something more definitive as it is not stated elsewhere (eg ageuk) and could arise from incomplete updating in 2016.

xylophone

Do you have any authoritative reference for backdating the post 2016 SP for 12 months as opposed to deferring?  

https://www.rights4seniors.net/content/claiming-state-pension-0

A claim for State Pension can be back-dated for up to 12 months from the date you claim.

Once a claim is made, you will receive details of how much your pension should be. If you disagree with the decision, you can ask for the decision to be reconsidered or you can appeal.

 Looking at the above, in terms of claiming state pension, there appears to be no differentiation between the old and new in terms of the one year backdating rule?

The OP can check with the Pension Service.

If she is expecting to have some reliance on the SP from the time she retires, it would be as well to get on with the claim as soon as possible?

Pat38493

But this rule is probably designed for if you intended to claim the pension at a certain point but you forgot to fill the form in, or were unable to for some reason.  This is different from deliberately deferring it?