UK Pension

[Parley]

10 minutes ago, tea4too said:

The UK benefit system can assume a 'notional income' If someone chooses not to claim an income to which they are entitled. I don't know whether this happens in Australia but suspect it might.  T x

Not sure what that has to do with it.

They certainly didn't contact my Mum in Australia asking her to claim the UK pension she was entitled to. She only found out when chatting to a neighbour that she might be eligible to claim having worked in the UK as a teacher for a number of years. 

[Parley]

1 minute ago, Marisawright said:

The Australian benefit system (Centrelink) insists on you applying for all overseas pensions first, before they decide what you'll get.

Well they didn't. 

[Andrew from Vista Financial]

Hello

Regards the UK Pension wiping out the Australian Age Pension dollar for dollar this is not the case, I understand it used to be when there was a social security however this ended in 2001: Termination of the Social Security Agreement with the UK - Information for Prospective Migrants | Department of Social Services, Australian Government (dss.gov.au) 

The way it is considered currently is under the income test: Age Pension - Income test for pensions - Services Australia, essentially any dollar of income (including income from the UK State pension) over the lower threshold reduces the Age Pension by 50c (as Marissa points out above) but if the income reaches the higher threshold (cut of point) then it cuts out completely.

However Centrelink also apply an asset test as well: Age Pension - Assets test - Services Australia both tests are carried out and whichever produces the lower result is what the Age Pension payments are based on.

So there could be a situation for some in that receipt of the UK State Pension has no bearing on what is received from the Centrelink Age Pension due to the assets test producing the lower outcome.

Regards

Andy

Edited May 20, 2021 by Andrew from Vista Financial

[Parley]

Interesting article. Australians who choose to live in France get no Australian pension at all

https://www.theage.com.au/world/europe/australians-in-france-stuck-without-pensions-call-for-help-20210618-p5821v.html

I suppose people can say they chose to live there knowing they wouldn't get the pension and can come home if they don't like it. But it they could live in the UK and get it it seems unfair.

[Marisawright]

9 minutes ago, Parley said:

Interesting article. Australians who choose to live in France get no Australian pension at all

https://www.theage.com.au/world/europe/australians-in-france-stuck-without-pensions-call-for-help-20210618-p5821v.html

I suppose people can say they chose to live there knowing they wouldn't get the pension and can come home if they don't like it. But it they could live in the UK and get it it seems unfair.

No, they couldn't get the Australian pension in the UK.  It's exactly the same.   

To get the Australian pension, you must either be permanently resident in Australia when you become eligible, OR reside in a country that has a special agreement with Australia on pensions and social security.  Once you've started receiving the pension, you can keep receiving it anywhere in the world - but you've got to meet that initial eligibility.

France has no agreement, and neither does the UK.  That's why I'm always warning people who want to stay in Australia but ultimately retire back in the UK.  Unless they stick it out in Australia until they've actually started receiving the Aussie pension, they will never be able to get it.    Looking around the world, they keep increasing the pension age, so there's a good chance that in the future, that will mean having to stay in Australia until they're 70.  

[BobHatton]

There is no reciprocal agreement for pensions between Australia and the UK anymore (I think it ended in 2001?). This means that you apply independently for your UK pension (through the International Pensions Website - download the form - fill it in and post it back). Your UK pension (whatever you're entitled to) will then be treated as income and you have to tell Centrelink about it. What this means is that Australia then takes this into account and adjusts your Australian entitlement accordingly. You don't need to do anything further; Centrelink works out the exchange rate on a monthly basis based on the CBA buy rate of pounds sterling. Just be aware that in Australia ANY income is counted (there are upper and lower limits of course) as the pension here is fully means tested both on income and assets. In fact, so much so that it pays to NEVER work or own a house here as you get full entitlements to everything.

[Paul1Perth]

On 13/05/2021 at 09:09, HappyHeart said:

I left the UK in my early 30s after working mainly part time. Will my UK Pension be worth anything and do I need to do anything about it? 

I've used the online tools but I never seem to come up with much. I just want to know how much it'll be worth, roughly. 

Might be worth giving the UK tax office a ring. If you can remember your NI number that will help. I got a letter from them stating what my British Pension would be worth. I didn't even know they knew my address. 

I rang them and they were surprisingly helpful.

[Paul1Perth]

On 22/06/2021 at 08:15, BobHatton said:

There is no reciprocal agreement for pensions between Australia and the UK anymore (I think it ended in 2001?). This means that you apply independently for your UK pension (through the International Pensions Website - download the form - fill it in and post it back). Your UK pension (whatever you're entitled to) will then be treated as income and you have to tell Centrelink about it. What this means is that Australia then takes this into account and adjusts your Australian entitlement accordingly. You don't need to do anything further; Centrelink works out the exchange rate on a monthly basis based on the CBA buy rate of pounds sterling. Just be aware that in Australia ANY income is counted (there are upper and lower limits of course) as the pension here is fully means tested both on income and assets. In fact, so much so that it pays to NEVER work or own a house here as you get full entitlements to everything.

If you own a house that's not counted in your assets so no worries there. Investment properties are though. Never dabbled or had enough money to do that though.

[HappyHeart]

1 hour ago, Paul1Perth said:

Might be worth giving the UK tax office a ring. If you can remember your NI number that will help. I got a letter from them stating what my British Pension would be worth. I didn't even know they knew my address. 

I rang them and they were surprisingly helpful.

I did manage to contact them online after advice on here and they sent me a form which I sent back. Just waiting for my letter in the post now. Surprisingly I can remember my NI number no problem. 

[Paul1Perth]

42 minutes ago, HappyHeart said:

I did manage to contact them online after advice on here and they sent me a form which I sent back. Just waiting for my letter in the post now. Surprisingly I can remember my NI number no problem. 

That was a surprise to me too. I'd not thought about it for years and I was surprised it was still in the memory bank when I had to remember it.

I was pleasantly surprised how much I get as we never bothered catching up on our payments. We were always on an offset mortgage so any cash that was in the account was helping to pay the mortgage quicker, thought that would be better use of money at the time. 

Don't get any pension from Aus yet as my wife still works, so we get too much income between us. When she retires though we should get some. Between that, our UK pension incomes, we have my wifes NHS one, one from Ferranti and another from the NCB I think we'll be able to tick over fine. Just have to adjust lifestyle to suit. Luckily a lot of the things we enjoy doing are either free or very cheap. Even cheaper with a seniors card

[HappyHeart]

Received my UK Pension forecast today in the post. It says I'll get $179.60 a week if I continue paying NI for 19 years (doesn't tell me how to do this or how much though) 

If I leave it as is I'll get $86.48 a week.

Does that sound right? Is the AU pension reduced if you also get your UK Pension? In other words is it worth A) claiming at all and B) topping up? 

[Marisawright]

25 minutes ago, HappyHeart said:

Received my UK Pension forecast today in the post. It says I'll get $179.60 a week if I continue paying NI for 19 years (doesn't tell me how to do this or how much though) 

If I leave it as is I'll get $86.48 a week.

Does that sound right? Is the AU pension reduced if you also get your UK Pension? In other words is it worth A) claiming at all and B) topping up? 

Yes it sounds right.

If you claim the UK pension then you lose about 50c of your Aussie pension for every $1 you get of British pension.

That said, remember that you'll get your UK pension from the day you retire.   Whereas you won't get a cent of Australian pension until your assets (including superannuation balance) falls below a certain amount. 

[Ken]

1 hour ago, HappyHeart said:

Received my UK Pension forecast today in the post. It says I'll get $179.60 a week if I continue paying NI for 19 years (doesn't tell me how to do this or how much though) 

If I leave it as is I'll get $86.48 a week.

Does that sound right? Is the AU pension reduced if you also get your UK Pension? In other words is it worth A) claiming at all and B) topping up? 

Centrelink don't allow you to not claim. As they see if there's money that you are owed that you aren't claiming then you can't be poor enough to need the Aged Pension.

[HappyHeart]

1 hour ago, Marisawright said:

Yes it sounds right.

If you claim the UK pension then you lose about 50c of your Aussie pension for every $1 you get of British pension.

That said, remember that you'll get your UK pension from the day you retire.   Whereas you won't get a cent of Australian pension until your assets (including superannuation balance) falls below a certain amount. 

Hmmm confusing. Super is extra to aged pension yes?

[Skani]

Consider your super as your base retirement income.  On top of that you will receive your UK pension.  However the Australian pension is means tested against both (a) any other income ie. your super and UK pension and (b) asset limits.  If your assets are within the maximum limits allowed, you may  receive either a partial Oz pension (on a sliding scale) or no pension at all - depending on the total of your other income.  Completely confused now?     

Edited June 30, 2021 by Skani

[Marisawright]

54 minutes ago, HappyHeart said:

Hmmm confusing. Super is extra to aged pension yes?

No. The Australian aged pension is a benefit like the dole, not a right. It’s means tested so you only get it if you have too many assets/too much income. It’s meant to look after the less well off in their old age.

Edited June 30, 2021 by Marisawright

[Johndoe]

On 30/06/2021 at 22:01, Marisawright said:

No. The Australian aged pension is a benefit like the dole, not a right. It’s means tested so you only get it if you have too many assets/too much income. It’s meant to look after the less well off in their old age.

Yup! I don't have any super as I've always been on home duties since coming to Oz and I have to rely on both my UK and Oz pension. I manage well enough as I don't have a mortgage and there's only myself and Jake to feed and my utilities have plummeted since Josh wet into the Navy.

If you are claiming both in Qld you don't get the full pensioners discounts on rego and utilities though.

 

[Ken]

On 30/06/2021 at 21:07, HappyHeart said:

Hmmm confusing. Super is extra to aged pension yes?

Yes, Super is the Australian equivalent of a Personal Pension Plan (with flexible withdrawals rather than an annuity) whereas the Aged Pension is a Social Security Payment to those in need.