Lump Sum Pension

Brie

HappyHarry said:

Brie said:

Dazed_and_C0nfused said:

I suspect there can't be many people left like the op as the State Pension must have now been deferred for nearly 10 years for a lump sum like this to be possible.

Lots of people still get their SP late for various reasons, mostly as they choose to.  If it is then back dated it's all in one lump with tax deducted.  Why do you think it would have to have been deferred for 10 years?

The ability to defer a state pension and receive it as a lump sum was only available to people with a state pension date prior to 6th April 2016.

Since then, if you defer your state pension, then you receive an enhanced weekly state pension but there is no option to take a lump sum.

Ah.  Perhaps both myself and the benefits system have gotten a situation wrong.  As I understand it - an individual had not taken their SP at SP age because they were still working and didn't need it yet.  They said to me that when they stopped working and decided to take their SP they were asked if they wanted it back dated and paid as a lump sum and they said great, yes!  So having received a large lump of SP they were then notified that they should not have claimed certain benefits and they had to repay those, which wiped out all the lump of SP they had received.   So either they didn't get paid a lump sum and had enhance SP payments and DWP misunderstood and shouldn't have reclaimed the benefits?

Marcon

Brie said:

HappyHarry said:

Brie said:

Dazed_and_C0nfused said:

I suspect there can't be many people left like the op as the State Pension must have now been deferred for nearly 10 years for a lump sum like this to be possible.

Lots of people still get their SP late for various reasons, mostly as they choose to.  If it is then back dated it's all in one lump with tax deducted.  Why do you think it would have to have been deferred for 10 years?

The ability to defer a state pension and receive it as a lump sum was only available to people with a state pension date prior to 6th April 2016.

Since then, if you defer your state pension, then you receive an enhanced weekly state pension but there is no option to take a lump sum.

Ah.  Perhaps both myself and the benefits system have gotten a situation wrong.  As I understand it - an individual had not taken their SP at SP age because they were still working and didn't need it yet.  They said to me that when they stopped working and decided to take their SP they were asked if they wanted it back dated and paid as a lump sum and they said great, yes!  So having received a large lump of SP they were then notified that they should not have claimed certain benefits and they had to repay those, which wiped out all the lump of SP they had received.   So either they didn't get paid a lump sum and had enhance SP payments and DWP misunderstood and shouldn't have reclaimed the benefits?

Nobody here can answer that without knowing when the individual concerned reached SPA. Maybe ask them?

QrizB

I have a vague recollection that post-2016 you can still defer your state pension for up to 12 months and get that paid as a lump sum?

Have I got that right? It'll be something I've read on the forum.

p00hsticks

Brie said:

HappyHarry said:

Brie said:

Dazed_and_C0nfused said:

I suspect there can't be many people left like the op as the State Pension must have now been deferred for nearly 10 years for a lump sum like this to be possible.

Lots of people still get their SP late for various reasons, mostly as they choose to.  If it is then back dated it's all in one lump with tax deducted.  Why do you think it would have to have been deferred for 10 years?

The ability to defer a state pension and receive it as a lump sum was only available to people with a state pension date prior to 6th April 2016.

Since then, if you defer your state pension, then you receive an enhanced weekly state pension but there is no option to take a lump sum.

Ah.  Perhaps both myself and the benefits system have gotten a situation wrong.  As I understand it - an individual had not taken their SP at SP age because they were still working and didn't need it yet.  They said to me that when they stopped working and decided to take their SP they were asked if they wanted it back dated and paid as a lump sum and they said great, yes!  So having received a large lump of SP they were then notified that they should not have claimed certain benefits and they had to repay those, which wiped out all the lump of SP they had received.   So either they didn't get paid pa lump sum and had enhance SP payments and DWP misunderstood and shouldn't have reclaimed the benefits?

Most income based benefits such as ESA, JSA, UC etc would stop automatically once a person reaches State Pension Age, whether they elect to claim their SP or not. 

Dazed_and_C0nfused

QrizB said:

I have a vague recollection that post-2016 you can still defer your state pension for up to 12 months and get that paid as a lump sum?

Have I got that right? It'll be something I've read on the forum.

After 5 April 2016 you can not get a lump sum in sense of a pre 6 April 2016 deferral lump sum, which DWP can deduct tax from and has special rules applied when it's taxed.

But when you apply for a deferred post 5 April 2016 State Pension you can ask for the start date to be backdated a maximum of 12 months.

DWP have to pay that as a "lump sum" but it is taxed exactly the same as normal State Pension payments are i.e. it is the tax year you are entitled to the pension in which counts, not when it was actually paid.  

So claim post 5 April 2016 State Pension today (and it has been deferred for at least 12 months) and you can ask for your claim to be backdated to July 2024.