Employer set up pension pot and Universal Credits

blackstar

Hi all,
Hoping for some advice please. I have 2 questions please. 
My partner, who's 48, I am 49 has been paying into a private pension set up by her employer which shows on her payslip which has been seen many times by UC.

It says: 
Earnings

Basic Pay

*Health Cash Plan - BiK               £****

Royal London Salary Exchange - £***

Employer's Contributions

NI (Category A)    £****
Royal London SE Employ £****
Royal London Salary Exc  £****

My two questions are:

1) Does she need to declare to Universal Credits the total amount of her Private Pension Pot with Royal London? Either as capital or income? She's doesnt draw any income from it.

2) Her Previous Employer also had a private pension with Aviva set up which ended 3 years ago when she left the company so that little pension pot is inactive and she has a choice to either leave as it is or merge it with her current pension pot. Does this one need to be declared to Universal Credits either as capital or income, again she doesn't get any income from it?

Any links to any official UC guidance on this would be most appreciated.

Grumpy_chap

The pensions don't need to be declared. They are not available as either capital or income.

peteuk

Slightly off topic - There has been other threads about salary sacrifice, so obviously your UC will be based on her take home pay. However if she is making a further contribution then this may not be initially taken into account.

blackstar

https://forums.moneysavingexpert.com/discussion/comment/81967677#Comment_81967677

When you say

"However if she is making a further contribution then this may not be initially taken into account."

Her payslips always show each month her full contributions to her pension and her employers also which UC see and base our UC base each AP payment on.

So presume that's ok?

I am unsure if her current pension or her other pension pot is drawing interest, I presume that makes no difference and both still remain not needed to be declared to Universal Credits correct?

Thanks

Brie

UC seems to take the principle that a pension is for when you retire. So you can work and pay in to one because that's a good thing to do. And you can't be made to dip in to it early as that's not a good thing for you financially. As I understand it.

peteuk

https://forums.moneysavingexpert.com/discussion/comment/81967694#Comment_81967694

You can make voluntry sacrifices of your income to further boost your pension. E.g. Your employer pays X, you pay Y but you then top up with Z.

UC will take into account X and Y, but will then calculate the take home pay before Z is taken out. So the take home pay on the wage is different from what DWP use for the 55p per pound reduction.

NedS

https://forums.moneysavingexpert.com/discussion/comment/81968137#Comment_81968137

I think your statement is potentially confusing.

Under UC reg 55(5)(a) any (all) relievable pension contributions made by a person must be deducted from a person's employed earnings when calculating their UC award.

So X, Y and Z in your example above must be deducted when calculating a person's employed earnings.

Whether that happens automatically will depend on how the person contributes any additional amount (Z), and how that is reported by the employer to HMRC (and then shared with DWP).

If it doesn't happen automatically, the claimant can ask for manual adjustment to their employed earnings to properly reflect any (all) pension contributions.

In reality, for most people, making additional pension contributions through their employers pension scheme, deducted directly through their payslip, should be the simplest method.

molerat

There was a big discussion here a few years back re higher rate tax payer paying so much into their pension that they were able to claim UC and the associated add on benefits.

NedS

https://forums.moneysavingexpert.com/discussion/comment/81968291#Comment_81968291

Indeed, legally there is nothing to stop them if they are able to live on such a reduced level of income income, but I would imagine most people earning in excess of £50k per year may struggle to live on benefit-levels of income.

kaMelo

https://forums.moneysavingexpert.com/discussion/comment/81968374#Comment_81968374

It was more of a thing with tax credits as it didn't take account of any capital held so it was quite easy to top up that reduced income from other sources. I imagine it's much less of a thing with UC as it takes into account all forms of capital held by a claimant.