State Pension on Tax Return (deferred)

WharpBlast

I am completing my tax return for the first time since passing state retirement age. I notice for State Pension it askes for "State Pension – amount you were entitled to receive in the year". Are they really asking for entitlement here rather than actual amount received ? If you have deferred state pension, entitlement is likely to be £10,000+ for a full year, but amount received zero. Entitlement is not the same as income.

molerat

If you have deferred and not receiving anything yet then the amount is £0.  That terminology refers to the way the state pension is taxed when in payment, on the amount due rather than the amount actually received in the tax year.

DRS1

The entitled versus received issue seems to cause a lot of angst on here.  Does someone actually tell you what your entitlement is for the tax year or are you meant to work it out somehow?

pinnks

Bottom line is you need to work it out.  The pension is a weekly benefit paid in arrears.  Entitlement arises on your weekly payment day and is not apportioned, other than your first pension week and your final days up to your date of death.  The pension increases each year on the first Monday of the new tax year and your first entitlement to the new amount is your first benefit week that commences on, or after, the increase day.

In simple terms you get 51 weeks at the rate for the year in question and 1 week at the rate for the previous year, except that every few years you get 53 weeks' entitlement just to stir things up.

woolly_wombat

DRS1 said:

The entitled versus received issue seems to cause a lot of angst on here.  Does someone actually tell you what your entitlement is for the tax year or are you meant to work it out somehow?

I’m pretty sure you are told how to calculate it.

51 weeks of current state pension payment plus 1 week of previous year’s state pension payment?

FIREDreamer

How about the first year of entitlement, eg reach SPA on 4 August 2024? What will you put on the 2024/25 tax return next year?

DRS1

Thank you both.  Sorry if I diverted the thread a bit.

Dazed_and_C0nfused

FIREDreamer said:

How about the first year of entitlement, eg reach SPA on 4 August 2024? What will you put on the 2024/25 tax return next year?

35 x the 2024-25 rate you are awarded should be satisfactory.

Dazed_and_C0nfused

WharpBlast said:

I am completing my tax return for the first time since passing state retirement age. I notice for State Pension it askes for "State Pension – amount you were entitled to receive in the year". Are they really asking for entitlement here rather than actual amount received ? If you have deferred state pension, entitlement is likely to be £10,000+ for a full year, but amount received zero. Entitlement is not the same as income.

Yes, you are taxed on the entitlement, not what you received.

Deferral seems to cause some confusion though.  When did you reach State pension age, pre 6 April 2016 or post 5 April 2016?

Assuming post 5 April 2016 have you made a backdated application after deferring?  For example say you reached SPA on 01-12-2020 and you applied in December 2023 did you ask for your pension to start in December 2023 or did you backdate the start date?

pinnks

Dazed_and_C0nfused said:

WharpBlast said:

I am completing my tax return for the first time since passing state retirement age. I notice for State Pension it askes for "State Pension – amount you were entitled to receive in the year". Are they really asking for entitlement here rather than actual amount received ? If you have deferred state pension, entitlement is likely to be £10,000+ for a full year, but amount received zero. Entitlement is not the same as income.

Yes, you are taxed on the entitlement, not what you received.

Deferral seems to cause some confusion though.  When did you reach State pension age, pre 6 April 2016 or post 5 April 2016?

Assuming post 5 April 2016 have you made a backdated application after deferring?  For example say you reached SPA on 01-12-2020 and you applied in December 2023 did you ask for your pension to start in December 2023 or did you backdate the start date?

My understanding is that you can only ask for your claim to be treated as late, and so backdated to your birthday, if you claim within 12 months of the original due date.  After that you are treated as having deferred.

Dazed_and_C0nfused

pinnks said:

Dazed_and_C0nfused said:

WharpBlast said:

I am completing my tax return for the first time since passing state retirement age. I notice for State Pension it askes for "State Pension – amount you were entitled to receive in the year". Are they really asking for entitlement here rather than actual amount received ? If you have deferred state pension, entitlement is likely to be £10,000+ for a full year, but amount received zero. Entitlement is not the same as income.

Yes, you are taxed on the entitlement, not what you received.

Deferral seems to cause some confusion though.  When did you reach State pension age, pre 6 April 2016 or post 5 April 2016?

Assuming post 5 April 2016 have you made a backdated application after deferring?  For example say you reached SPA on 01-12-2020 and you applied in December 2023 did you ask for your pension to start in December 2023 or did you backdate the start date?

My understanding is that you can only ask for your claim to be treated as late, and so backdated to your birthday, if you claim within 12 months of the original due date.  After that you are treated as having deferred.

Not what Age UK seem to be saying.  You can only backdate a maximum of 12 months but it doesn't appear to be related to your birthday/SPA.

Can I put off claiming my State Pension?

Yes, you can. This is known as ‘deferring’.

Deferring might mean you get more pension when you do claim, but it can also affect any benefits you may be claiming now. For advice on whether deferring is the right option for you,

talk to your local Age UK or the Pension Service (page 15). In Wales, contact your local Age Cymru.  If you don’t claim your State Pension, it’ll automatically defer.

Can I backdate my State Pension?
If you claim your State Pension after you reach State Pension age then you can ask to backdate it. The maximum period of backdating is 12 months – but a claim can’t be backdated to a date before you reached State Pension age. You don’t need any special reasons for backdating