UK state pensions and Brit expats retired overseas

[richfool]

This petition may be of interest to Brits retired overseas or planning to do so.

https://petition.parliament.uk/petitions/601821

[nimnarb]

Hi Rich, Haven't visited this board for quite a while, so not up to date on recent possible rules but unless I am wrong this does not apply to all. If you move to an EU country, the US or one of a disparate list of countries including Israel, Mauritius and the Philippines, your state pension will rise in line with inflation.

[mc2fool]

Hi Rich, Haven't visited this board for quite a while, so not up to date on recent possible rules but unless I am wrong this does not apply to all. If you move to an EU country, the US or one of a disparate list of countries including Israel, Mauritius and the Philippines, your state pension will rise in line with inflation.

Yes, the petition is poorly phrased. Presumably the originator has moved/is moving to one of the other 150 countries where they won't get any increases at all...

https://www.gov.uk/government/publications/state-pensions-annual-increases-if-you-live-abroad/countries-where-we-pay-an-annual-increase-in-the-state-pension

[richfool]

Yes, that wasn't too clear. There is no issue with EU countries, and some others including the USA, though UK state pensions are frozen if paid to Canada, Australia, New Zealand, South Africa, Thailand and many others.

[20thcenturyboy]

I'm a Brit in Oz, and will likely retire in Oz.
I'm going ahead and purchasing as many voluntary Class 2 NI contributions as I can, so I can maximise the UK state pension. I know it doesn't rise with inflation here, but it's still good value (at least for Class 2 NI which is only currently GBP158 for each purchased year of NI). Oh yeah I signed the petition of course.

[AF62]

Isn’t the issue that the increases are paid where there is a reciprocal agreement, and not paid where there isn’t.

So given it takes ‘two to tango’ are there similar petitions going on in those countries where UK pensioners don’t get the increase, for those countries to pay increases to their pensioners who reside in the UK?

[servodude]

Isn’t the issue that the increases are paid where there is a reciprocal agreement, and not paid where there isn’t.

So given it takes ‘two to tango’ are there similar petitions going on in those countries where UK pensioners don’t get the increase, for those countries to pay increases to their pensioners who reside in the UK?

Sort of... the Australians certainly stopped the practice because the UK were refusing to dance

The Australian Government terminated its social security agreement with the UK in 2001 because the UK Government had long refused to change its policy of not indexing pensions paid to Brits in Australia, despite providing indexation to pensioners in other countries with similar social security agreements to that held with Australia.
<snip>
The freezing policy was introduced by the UK in 1946, with the lack of pension increases affecting not only UK residents retiring in Australia, but also Australians who worked in the UK and therefore made sufficient NI contributions to be eligible for a pension.

[AF62]

Some interesting details here - https://researchbriefings.files.parliam ... N01457.pdf

It seems that the UK government policy since 1996 has been that any new reciprocal arrangements only deal with issues about social security contributions being duplicated in two countries, not increases to pensions. The policy is because such pension increases don’t tend to benefit the pensioner who retired overseas but the overseas government and their taxpayers.

To quote from the document-

Responding, the then Pensions Minister Steve Webb explained that most UK pensioners overseas lived in either Canada or Australia. Uprating the State Pension in those countries would be at a cost the British taxpayer but would not necessarily benefit British citizens living in those countries:

“I understand that just short of three in four of the people we are talking about are in Canada or Australia. It was suggested that the Canadian and Australian Governments would like us to increase pensions in such cases, and indeed they would. That is because they have means-tested state pension systems. If we were to increase state pensions in Canada and Australia - for nearly three quarters of the people we are talking about - that would be a saving to the Canadian and Australian Exchequers at the cost of the British taxpayer, not necessarily to the benefit of the British citizen living abroad. There would be British citizens whose incomes would be above the level at which they qualify for the means-tested pension in those countries, but they are not the folk whom people are most concerned about - the folk who have nothing else to live on.”

[stevensfo]

I'm a Brit in Oz, and will likely retire in Oz.
I'm going ahead and purchasing as many voluntary Class 2 NI contributions as I can, so I can maximise the UK state pension. I know it doesn't rise with inflation here, but it's still good value (at least for Class 2 NI which is only currently GBP158 for each purchased year of NI). Oh yeah I signed the petition of course.

Shouldn't you be purchasing Class 3 contributions?

Steve

PS IS there a rule that says how many years can be backdated? I currently have 15 years contributions. If I retire in the EU at 62, can I pay contributions till the UK state pension age at 67?

PPS HOW do you pay? There is some advice on the gov website about the exact reference to write in the bank transfer, but it seems I should phone them first to check. From what I heard, the lines are permanently engaged.

[mc2fool]

I'm a Brit in Oz, and will likely retire in Oz.
I'm going ahead and purchasing as many voluntary Class 2 NI contributions as I can, so I can maximise the UK state pension. I know it doesn't rise with inflation here, but it's still good value (at least for Class 2 NI which is only currently GBP158 for each purchased year of NI). Oh yeah I signed the petition of course.

Shouldn't you be purchasing Class 3 contributions?

Steve

PS IS there a rule that says how many years can be backdated? I currently have 15 years contributions. If I retire in the EU at 62, can I pay contributions till the UK state pension age at 67?

PPS HOW do you pay? There is some advice on the gov website about the exact reference to write in the bank transfer, but it seems I should phone them first to check. From what I heard, the lines are permanently engaged.

Most of your questions are answered in https://www.gov.uk/voluntary-national-insurance-contributions and the pages that follow.

Re class 2/3 for folks living abroad, how many years can be backdated, and how to pay -- see link.
Yes, you can keep paying in until the tax year before you reach state pensions age (assuming it is worth doing so).

[stevensfo]

I'm a Brit in Oz, and will likely retire in Oz.
I'm going ahead and purchasing as many voluntary Class 2 NI contributions as I can, so I can maximise the UK state pension. I know it doesn't rise with inflation here, but it's still good value (at least for Class 2 NI which is only currently GBP158 for each purchased year of NI). Oh yeah I signed the petition of course.

Shouldn't you be purchasing Class 3 contributions?

Steve

PS IS there a rule that says how many years can be backdated? I currently have 15 years contributions. If I retire in the EU at 62, can I pay contributions till the UK state pension age at 67?

PPS HOW do you pay? There is some advice on the gov website about the exact reference to write in the bank transfer, but it seems I should phone them first to check. From what I heard, the lines are permanently engaged.

Most of your questions are answered in https://www.gov.uk/voluntary-national-insurance-contributions and the pages that follow.

Re class 2/3 for folks living abroad, how many years can be backdated, and how to pay -- see link.
Yes, you can keep paying in until the tax year before you reach state pensions age (assuming it is worth doing so).

Thanks! A quick calculation makes it clear that I'd be mad not to take advantage of the voluntary contributions.

I may be wrong, but it looks like I can pay for a number of previous years as well as future years.

Steve

[mc2fool]

Thanks! A quick calculation makes it clear that I'd be mad not to take advantage of the voluntary contributions.

I may be wrong, but it looks like I can pay for a number of previous years as well as future years.

Indeed, even with the more expensive class 3 NICs it's still an amazingly good deal.

As for which years you can pay and, more importantly, which it's worth paying, if you get and post the info listed in viewtopic.php?p=398678#p398678 we can figure that out in detail. Probably best to start a new thread with it.

[20thcenturyboy]

I'm a Brit in Oz, and will likely retire in Oz.
I'm going ahead and purchasing as many voluntary Class 2 NI contributions as I can, so I can maximise the UK state pension. I know it doesn't rise with inflation here, but it's still good value (at least for Class 2 NI which is only currently GBP158 for each purchased year of NI). Oh yeah I signed the petition of course.

Shouldn't you be purchasing Class 3 contributions?

Steve

Hi Steve,

You can purchase Class 2 as long as you worked in the UK for some years immediately before leaving, not sure of the exact number. Anyway I sent the form off to UKGOV (NI38 I think) and they wrote back 5 months later saying I was approved for Class 2.

[20thcenturyboy]

As mentioned I am attempting to purchase Class 2 NI voluntary contributions from overseas. As I don't have a UK bank account I used Wise to transfer the payment (1 year as a test) following the online process. That was 6 weeks ago. So far I can't see any record of my payment on my NI history page and nor have I received any acknowledgement of payment. Sigh. Nor is it clear which year I am purchasing. Not a great process so far.

[stevensfo]

I'm a Brit in Oz, and will likely retire in Oz.
I'm going ahead and purchasing as many voluntary Class 2 NI contributions as I can, so I can maximise the UK state pension. I know it doesn't rise with inflation here, but it's still good value (at least for Class 2 NI which is only currently GBP158 for each purchased year of NI). Oh yeah I signed the petition of course.

Shouldn't you be purchasing Class 3 contributions?

Steve

Hi Steve,

You can purchase Class 2 as long as you worked in the UK for some years immediately before leaving, not sure of the exact number. Anyway I sent the form off to UKGOV (NI38 I think) and they wrote back 5 months later saying I was approved for Class 2.

5 months later??

I have to admit that it is more confusing than I thought. From reading the guidelines, it appears that both Class 2 and Class 3 relate to those who worked in the UK before leaving ( I did), but Class 2 is for those who were self-employed. Then again, the more I read the various pages of info, the more confusing it gets.

There is also a section about being 'Ordinarily Resident in the UK' and it appears that I am, though again a bit confusing, since it seems to overlap with what I always assumed was 'Domiciled'.

Anyway, I will send off the form and see what happens.

Steve

PS Shame you couldn't have used a relative's address to keep your accounts going, and a foot in each country. That's been a life-saver for me.

[20thcenturyboy]

I'm a Brit in Oz, and will likely retire in Oz.
I'm going ahead and purchasing as many voluntary Class 2 NI contributions as I can, so I can maximise the UK state pension. I know it doesn't rise with inflation here, but it's still good value (at least for Class 2 NI which is only currently GBP158 for each purchased year of NI). Oh yeah I signed the petition of course.

Shouldn't you be purchasing Class 3 contributions?

Steve

Hi Steve,

You can purchase Class 2 as long as you worked in the UK for some years immediately before leaving, not sure of the exact number. Anyway I sent the form off to UKGOV (NI38 I think) and they wrote back 5 months later saying I was approved for Class 2.

5 months later??

I have to admit that it is more confusing than I thought. From reading the guidelines, it appears that both Class 2 and Class 3 relate to those who worked in the UK before leaving ( I did), but Class 2 is for those who were self-employed. Then again, the more I read the various pages of info, the more confusing it gets.

There is also a section about being 'Ordinarily Resident in the UK' and it appears that I am, though again a bit confusing, since it seems to overlap with what I always assumed was 'Domiciled'.

Anyway, I will send off the form and see what happens.

Steve

PS Shame you couldn't have used a relative's address to keep your accounts going, and a foot in each country. That's been a life-saver for me.

See here:

https://www.gov.uk/voluntary-national-i ... tributions

Specifically:

Living and working abroad
Class 2 - but only if you worked in the UK immediately before leaving, and you’ve previously lived in the UK for at least 3 years in a row or paid at least 3 years of contributions.

No need for self-employment
If you check your NI contribution history (available online) you will see what previous years you can purchase. Currently you can go back as far as 2006-2007 to purchase. The rules may change in the future though.

5 months - yeah, any written comms to the pensions dept takes an absolute age to get actioned.

[stevensfo]

Shouldn't you be purchasing Class 3 contributions?

Steve

Hi Steve,

You can purchase Class 2 as long as you worked in the UK for some years immediately before leaving, not sure of the exact number. Anyway I sent the form off to UKGOV (NI38 I think) and they wrote back 5 months later saying I was approved for Class 2.

5 months later??

I have to admit that it is more confusing than I thought. From reading the guidelines, it appears that both Class 2 and Class 3 relate to those who worked in the UK before leaving ( I did), but Class 2 is for those who were self-employed. Then again, the more I read the various pages of info, the more confusing it gets.

There is also a section about being 'Ordinarily Resident in the UK' and it appears that I am, though again a bit confusing, since it seems to overlap with what I always assumed was 'Domiciled'.

Anyway, I will send off the form and see what happens.

Steve

PS Shame you couldn't have used a relative's address to keep your accounts going, and a foot in each country. That's been a life-saver for me.

See here:

https://www.gov.uk/voluntary-national-i ... tributions

Specifically:

Living and working abroad
Class 2 - but only if you worked in the UK immediately before leaving, and you’ve previously lived in the UK for at least 3 years in a row or paid at least 3 years of contributions.

No need for self-employment
If you check your NI contribution history (available online) you will see what previous years you can purchase. Currently you can go back as far as 2006-2007 to purchase. The rules may change in the future though.

5 months - yeah, any written comms to the pensions dept takes an absolute age to get actioned.

Thanks for that. It would be great if I could pay Class 2. I really have to start making a list, and printing all the pages of advice from gov.uk, since this one looks different to to others I've seen.

When I accessed my personal N.I. records and looked at the years when I hadn't contributed, clicking on each year told me if I could make NICs. I was quite surprised to see how far back I could go! Yes, I think it was about 2006/7.

I have to check but I think there may be two separate forms for class 2 and 3. If so, I'll send both with covering letter and official docs from my employer abroad.

So irritating that they will not accept forms sent as email attachments, or via online forms! Since I've already jumped through ID hoops to logon, it doesn't make sense!

Steve