Is COPE deducted from my forecasted pension

pepsimax63

Hi All,

I have 25 qualifying years of NIC's, was contracted out from 1993-2008 (final salary scheme) and hope to retire in July 2024 (just over age 61). I spoke with HMRC today and we agreed that I need to pay 10 years of missed contributions (from 2010 onwards). I've received a pension forecast as follows:

5/4/22 - £124.87 pw 
6/4/24 - £185.15 pw (based on current rates)

I wanted to check if the COPE of £35.09 pw would be deducted from the forecasted £185.15 pw as I need to justify paying circa £6,900 as a one off payment and want to make sure I won't be worse off than I thought.

Many thanks for all of your help

Teresa

Stubod

..no, cope is a "guestimate" as to how much you "might"  get from a private scheme that you were contracted out to, it does not affect your SP...

molerat

No. The COPE was only used once and that was to calculate the 2016 starting amount.  It has no effect on the figures you see on the forecast.

You need 12 years of contributions to reach the maximum

10 past years could work as it looks like you may have less than 26 pre 2016 years.

Is there a reason why you want to fill lots of past years when you have a fair few years going forward ?

With a few details we can sense check what you have been told (I know some of the details are in your post)

Current £.pp amount accrued up to April 2022
Number of pre 2016 NI years full
Number of post 2016 NI years full
Financial year you reach state retirement
Any COPE amount shown
Years which show not full and prices

dunstonh

I wanted to check if the COPE of £35.09 pw would be deducted from the forecasted £185.15 pw

Read your forecast again.  It tells it isn't deducted in the lines that follow the figure.

xylophone

I wanted to check if the COPE of £35.09 pw 

The COPE was used  once only at 6/4/16  to establish your starting amount for NSP.

Your starting amount was the higher of

Old Rules

NI  qualifying years/30 (max) x £119.30 (Full Basic) + (Additional State Pension - Deduction for Contracting Out).

New Rules

{NI qualifying years/35 (max) x £155.65 (Full NSP)} - Contracted Out Pension Equivalent.

Have a look at the chart on P6 here

https://www.dpf.org.uk/explorer/files/TOPPING-UP-YOUR-STATE-PENSION-GUIDE.pdf

enthusiasticsaver

molerat said:

Is there a reason why you want to fill lots of past years when you have a fair few years going forward ?

I guess it is because the OP says they want to retire in July 2024 at age 61. 

Are you a grandparent OP and do you do any childcare?  I was short of 3 years to get a full pension as I took early retirement at 58.  I claim childcare credits to get extra years NI contributions as I looked after my grandchildren for a few days a week from 2015 until 2022 until they started school and  now do a few days during the school holidays.  That has saved me shelling out £800 per year of contributions and I am now up  to  full pension. 

molerat

enthusiasticsaver said:

molerat said:

Is there a reason why you want to fill lots of past years when you have a fair few years going forward ?

I guess it is because the OP says they want to retire in July 2024 at age 61. 

Are you a grandparent OP and do you do any childcare?  I was short of 3 years to get a full pension as I took early retirement at 58.  I claim childcare credits to get extra years NI contributions as I looked after my grandchildren for a few days a week from 2015 until 2022 until they started school and  now do a few days during the school holidays.  That has saved me shelling out £800 per year of contributions and I am now up  to  full pension. 

How does that matter ?  Paying a lot of years ahead is a bit like betting on a one horse race, you are guaranteed a payout if it passes the finishing line.  If it falls at the last hurdle (or maybe the first) you have lost your bet.  Drip feeding as necessary hedges that bet.

Kynthia

enthusiasticsaver said:

molerat said:

Is there a reason why you want to fill lots of past years when you have a fair few years going forward ?

I guess it is because the OP says they want to retire in July 2024 at age 61. 

Are you a grandparent OP and do you do any childcare?  I was short of 3 years to get a full pension as I took early retirement at 58.  I claim childcare credits to get extra years NI contributions as I looked after my grandchildren for a few days a week from 2015 until 2022 until they started school and  now do a few days during the school holidays.  That has saved me shelling out £800 per year of contributions and I am now up  to  full pension. 

I gifted 3 years of NI credits to my mother that I received from child benefit. It was nice to do something that saved her money in return for all she does for me. 

The list of people you can gift NI credits to is quite long. Some people think it's just grandparents who qualify but lots of family could benefit. 
https://www.gov.uk/government/publications/national-insurance-credits-for-adults-who-care-for-a-child-under-12-fact-sheet/specified-adult-childcare-credits-fact-sheet

Blue_Butterfly

You may be able to claim Carer NI credits if you are caring for an elderly or disabled person for a minimum of 20 hours per week.

pepsimax63

Amazing responses, as every. Molerat, info update as follows:

Current £124.87 pension pw amount accrued up to April 2022
Number of pre 2016 NI years full - 24 years
Number of post 2016 NI years full - 1 (21/22 so far, but will be 22/23 and 23/24)
Financial year you reach state retirement - 2030 (although I'm choosing to retire in July '24)
Any COPE amount shown - £35.09pw
Years which show not full and prices - 18 years

After talking to HMRC Future Pensions Centre I was advised I could pay 10yrs NIC's for circa £6,900 which would then give me 37yrs NICS (up to Jul '24) and therefore my full state pension.

Hope this makes sense!

pepsimax63

Just to confirm - I'm not/never have been a carer or grandparent. I also have a final salary banking company pension which I have been drawing since 2008 (I retired due to ill health - returned to work in 2016).