UK state pension for overseas returner

fruitbat_2

Hi I'm wondering if anyone has been in my future situation.
Currently live in NZ, work full time here, pay income tax. Thinking we might return to the UK to retire.
Noticing the recent news about NI top ups I logged in to check my UK state pension forecast. I've got 19 years, so would need another 16 I think to get a full state pension. Chances of being back in UK soon enough to do this are slim.

I know there are state pension agreements between the UK and NZ but the gov.uk website has been utterly unhelpful as to what this means for me. I found this on the NZ equivalent site: 

"If you don't receive New Zealand Superannuation before leaving New Zealand and you would like the period of your New Zealand residence to be taken into account when applying for a United Kingdom benefit or pension, you will need evidence of that time.This includes tax certificates, employers’ references, wage slips, travel documents, testimonials, work references and letters from neighbours and friends (please provide their contact details)." 

I would like to know if anyone has returned to the UK from overseas and provided this evidence to HMRC in order to top up their state pension. If so what evidence did you have to provide and at what point? I can get official tax statements covering my whole time here but haven't kept wage slips going back to day one, or got references from old employers. If I'm going to need this evidence I could start to collect it. 

TL:DR - I am hoping that working overseas means I won't need to make any additional NI top ups on return to the UK, but would like to know sooner rather than later how all this works, and what proof I need to hang on to. 

NB I have emailed the international pensions office but as it's a UK government office I don't anticipate a speedy reply. 

Thanks all! 

Dazed_and_C0nfused

Noticing the recent news about NI top ups I logged in to check my UK state pension forecast. I've got 19 years, so would need another 16 I think to get a full state pension.

You fall under transitional rules so it some coincidence you happen to need 35 years, which is the number needed by those fully under the new rules i.e. starting to pay NI from 2016???

Why do you only "think" you need 16?  Your forecast shows quite clearly what your accrued amount is (usually to 5 April 2022) and, at the very least, you can work out from that how many post 2016 years you need to reach £185.15.

Janie2008

Have you checked your pension forecast as well as your NI record? That will show the amount of pension you would currently receive as well as how many more years you need. This does vary and is complicated. I need 34 years but my husband needs 38 years.

bostonerimus

International social security agreements do not usually allow foreign contributions to be used to calculate the amount of benefit, they just count in qualifying for benefits. If you are working in NZ you should immediately apply to pay UK Class 2 NI and pay any top up payments you can as they are ridiculously inexpensive. Make sure you understand what NZ state pension you will get if you return to the UK.

fruitbat_2

Thanks for ignoring my question! Happy to concede I might be wrong on the 35 years, but that’s not the point of my post. 

Has anyone returned from overseas to the UK and managed to provide proof of paying income tax overseas, as the NZ govt website says you can do, that was recognised as equivalent to NI contributions? Or do I need to wait for a reply from the overseas pensions office! 

OldBeanz

fruitbat_2 said:

Thanks for ignoring my question! Happy to concede I might be wrong on the 35 years, but that’s not the point of my post. 

Has anyone returned from overseas to the UK and managed to provide proof of paying income tax overseas, as the NZ govt website says you can do, that was recognised as equivalent to NI contributions? Or do I need to wait for a reply from the overseas pensions office! 

I think the concept being suggested is that you keep the 2 pensions separate. My son is currently in Australia and is paying £180 for every year of NI at class 2 which will contribute to a UK pension. Each year of contributions will pay him £250+ per year (inflation linked) when he retires although if he remains in Australia the inflation links drop after he starts drawing it. If you return they don't. The money pays for itself after less than 9 months. Even the more expensive class 3 take less than 4 years. Someone reasonably healthy can expect to live for another 18-20 years.

p00hsticks

fruitbat_2 said:

Thanks for ignoring my question! Happy to concede I might be wrong on the 35 years, but that’s not the point of my post. 

Has anyone returned from overseas to the UK and managed to provide proof of paying income tax overseas, as the NZ govt website says you can do, that was recognised as equivalent to NI contributions? Or do I need to wait for a reply from the overseas pensions office! 

I'm not sure about this but I think you may have misinterpreted what the NZ site is saying. I'm no expert, but my understanding is that paying the foreign equivalent of NI abroad doesn't have any effect on the actual amount of UK State Pension you may be entitled to. 

Its significance is that the year can be counted as a year when considering if you are entitled to any UK State Pension at all - you now need a minimum of ten full years NI to qualify, and equivalent payments abroad can be included in that ten. However, they  won't increase the actual amount you are entitled to.

Given that you say you already have 19 UK NI years, this isn't going to be a factor for you. 

Paying NZ income tax, NI or whatever their equivalent is, will presumably be earning you some sort of NZ state pension (if they have one). 

The 19 years you had before you left the UK will also entitle you to a UK State Pension, depending on your personal NI record, but with only 19 years at present it won't currently be the full £185.15 amount - your State Pension forecast will tell you how much. 

However, while abroad, you still have an option to make further voluntary contributions to purchase UK NI years both going forward and to fill any gaps (although as I'm sure you're aware, the deadline for years 2006-7 to 2016-17 is in a few weeks; after that you can only go back six years). If you were in employment immediately before leaving the UK you could pay at the really cheap Class 2 rate, but even Class 3 is incredibly good value. You don't say how long you've been in NZ, and I'm not aware of whether there is any deadline for no longer being eligible to pay at the Class 2 rate, although I'm sure others on the board will be able to tell you. 

bostonerimus

p00hsticks said:

fruitbat_2 said:

Thanks for ignoring my question! Happy to concede I might be wrong on the 35 years, but that’s not the point of my post. 

Has anyone returned from overseas to the UK and managed to provide proof of paying income tax overseas, as the NZ govt website says you can do, that was recognised as equivalent to NI contributions? Or do I need to wait for a reply from the overseas pensions office! 

I'm not sure about this but I think you may have misinterpreted what the NZ site is saying. I'm no expert, but my understanding is that paying the foreign equivalent of NI abroad doesn't have any effect on the actual amount of UK State Pension you may be entitled to. 

That is generally the case with bilateral social security agreements, but NZ might be different, the OP will have to check with HMRC or a more knowledgeable forum dedicated to NZ matters. I am pretty sure that NZ won't pay superannuation to UK residents, so maybe HMRC will give credit for NZ contributions in calculating the amount of UK SP.

There is a section in the UK SP application to describe foreign employment and contributions to other systems and supporting documents include, according to the NZ government website, "tax certificates, employers’ references, wage slips, travel documents, testimonials, work references and letters from neighbours and friends (please provide their contact details)."

If you already receive New Zealand Superannuation you will need to contact Senior Services International in New Zealand for a letter which will:

• verify that you received New Zealand Superannuation or Sole Parent Support for widows and the date this stopped
• state that you received this payment in your own right (not using another social security agreement to meet the criteria).

Brie

Can't help with your actual question OP so sorry about that.  But I'm curious if the same is required when returning from other countries.  Prob is that the OH will receive pocket money from the Canadian Pension Plan but is short on the NI contributions for SP.  The second half of the problem is that having never considered this previously (e.g. when we returned to the UK) I doubt we have any documentation.  So how does someone get around that?  

bostonerimus

Letters from employers, pay stubs, pension and tax statements from the relevant authorities will work. Foreign pensions will have to be entered on your UK tax self assessment so they can be taxed appropriately.

I get a US government state pension and will receive US Social Security and I have kept up my UK voluntary NI for the past 35 years so when I apply for UK SP I will enter their details and amounts and have monthly statements for proof.

pinnks

There is a UK-NZ Social Security Agreement that looks somewhat different to those I have seen for other countries.  It seems to say that NZ years can help you get to the UK 10-year requirement.  Not relevant if you have 19 years already but also seems to say that if you return before claiming in NZ, you would not be able to claim a NZ pension and will get only whatever is your UK entitlement but if you are already claiming in NZ then that may feed into the UK system. All quite odd, unless I have got completely the wrong end of the stick on scanning this link. Social security agreement with the United Kingdom - Work and Income

"If you reside in the United Kingdom you can't be paid New Zealand benefits and pensions. However, you may qualify for United Kingdom benefits or pensions."  That suggests you cannot get a NZ pension once you move back to the UK.

And in terms of what UK state pension you may get:
"f you didn't receive New Zealand Superannuation or Sole Parent Support for widows prior to leaving New Zealand, the rate you are paid for United Kingdom benefits and pensions depends on contributions you made to the National Insurance Scheme and time resided in New Zealand.

If you received New Zealand Superannuation or Sole Parent Support for widows prior to leaving New Zealand, you may receive the full standard rate of the United Kingdom State Pension or Widow's Allowance/Basic Widow's Pension.

In both cases, the International Pension Centre decides how much will be paid."

Time to do some serious research and/or take professional advice to confirm the above or discount it as me having got the wrong end of that stick...