UK National Insurance Contributions

[changnoi]

I know very little on this subject so wait for Blackcat's reply.

 

 

 

However, one thing I've come across in the UK is that people with reduced rate State Retirement Pensions have had their income "topped-up" with Income Support payments to around the full SRP level.

 

 

 

In other words they get the same amount out of the UK system in spite of having chosen not to make the full contribution.

 

 

 

In fact sometimes people can be better off this way, as consequent Income Support entitlement may open the door for them to obtain other benefits.

 

 

 

Private pensions also have an effect here, whereby a man of 65 on SRP who has a very small (say £20-30 a week) private pension can lose out on other state help because this additional money he has coming in raises him above the means tested benefit threshold. Another man of the same age who has not saved (or has hidden his savings in fine wine or whatever) could be better off.

 

 

 

Thanks to the recent collapse of stock markets / pension funds I would imagine that a lot of people could be in this situation in the near future. A large private pension, and NOT a small one, is what we all need: but have you looked at how much that currently costs ? As much as a small salary, especially if you didn't start when you were 21.

 

 

 

Of course UK Income Support benefits are not paid to retirees in Thailand (although I suspect some fiddling in the Incapacity Benefit category) nor is SRP, although as BC says thanks to automated banking some may be enjoying the best of both worlds. This situation may not continue forever, especially as (as Bemba points out) the British Government are very keen to reduce unnecessary outgoings.

 

 

 

Writing this just makes me realise how little I know about all this. I wish I knew of a good, current book on the subject. Can any one recommend one ?

 

 

 

CAVEAT

 

 

 

Not only can things change, but I believe that in the next 10, 20,30 years they are going to change dramatically. And at an accelerated rate.

 

 

 

The tax / benefit system can be counter-intuitive, or at least surprising on occasion. When planning my last trip of three months I discovered that I was to be liable for full council tax on my unoccupied home during my absence, a not insignificant cost. Looking ahead with a view to avoiding this on my next (long term) excursion I'm considering letting the property. However, I've discovered that even if I adopt non-resident tax status, I'm still liable to the Revenue in the UK for tax on any rental income that I obtain.

 

 

 

So I discover, to my surprise, that even if I become a "tax exile" I can still be liable for tax to Her Majesty's government. (BTW, wish I had her financial advisor). I can imagine the kind of tangle I could get myself into in the future, claiming SRP in the UK while living in Thailand as a non-resident tax payer !

 

I wonder how the Revenue would feel about that ?

 

 

 

 

 

 

[stumpy]

Hi Changnoi,

 

 

 

Thanks for that. Just to comment on your last paragraph, I have a friend who does have a UK pension paid into his bank but lives in Thailand.

 

 

 

He did work and pay tax in the UK so that may be the difference.

 

 

 

My point is that the UK benefit system seems to be cradle to grave for some people and I just can't see anyone in old age being refused money to live on from one source or another but like you I would be interested to know the correct position.

 

Cheers,

 

 

 

Stump_Dog.

[Guest]

Hi Stumpdog,

 

 

 

If a person is resident in the UK and does not have an adequate contribution record they do not receive the RP pension.

 

 

 

As Changnoi says, they are eligible to claim Income Support to raise their income to what the Govt considers a minimum amount to live on per week. This is very much similar to the way that a person who does not have entitlement to Job Seekers Allowance when unemployed can still make a claim to and receive Income Support to live on.

 

 

 

A couple of points to make:-

 

 

 

Retirement pension is paid whatever the financial circumstances of the claimant, Income support is means tested. if you have no income but do have savings over a certain limit you are expected to live off your savings. If you have between around 3000 pound and 8000 pound in savings your weekly Income Support eligibility is reduced on a sliding scale depending on the level of your savings. Over around 8000 you have no entitlement.

 

 

 

Income support is not payable to UK nationals resident abroad so if you do intend to live over here after retirement AGE it's the Retirement Pension or nothing.

 

 

 

 

 

 

 

 

[changnoi]

A useful webpage

 

 

 

www.dwp.gov.uk/lifeevent/benefits/retirement_pension_forecast.htm#elec

 

 

 

The DSS appears to be no more, long live the DWP !

 

 

 

I couldn't work out how to request pension information online. The new site looks worse than its predecessor, and god knows how much it cost.

 

 

 

I've applied for a pension forecast. They hope to reply within 40 days...