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Business & Finance1 min ago
state pension for brits living abroad
My mum in law (89yrs) lives in south africa. She was born here and lived here till she retired at 63yrs whereapon she moved to SA.
She worked all her adult life and thus contributed tax etc.
She has not once in all that time rcvd an increase in her state pension.
Which does not seem fair considering the entire time she has lived in SA she has not needed to "burden" to state by using NHS or housing or anything like that at all.
Could someone tell me why this is so? Is this correct or is there some way she should have applied for an increase over the years?
We are trying to sort out alot of her affairs as she has now got dementia and is in full time (privately paid for) care in South Africa. We are in the process of getting power of attorney but do not yet have this so the DWP is able to give me only limited info right now.
Thanks in advance and thanks to those who answered a previously related query a week or so back relating to pensions.
She worked all her adult life and thus contributed tax etc.
She has not once in all that time rcvd an increase in her state pension.
Which does not seem fair considering the entire time she has lived in SA she has not needed to "burden" to state by using NHS or housing or anything like that at all.
Could someone tell me why this is so? Is this correct or is there some way she should have applied for an increase over the years?
We are trying to sort out alot of her affairs as she has now got dementia and is in full time (privately paid for) care in South Africa. We are in the process of getting power of attorney but do not yet have this so the DWP is able to give me only limited info right now.
Thanks in advance and thanks to those who answered a previously related query a week or so back relating to pensions.
Answers
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Annual indexation increases
The answer as to whether it is correct is here - it is correct.
http://www.pensionsadvisoryservice.org.uk/Stat e_Pensions/Living_Overseas/
(see under UK State Pension Annual Increases).
I'm not going to try and defend it - it's just the rules. It's little comfort but it has always been that way.
The answer as to whether it is correct is here - it is correct.
http://www.pensionsadvisoryservice.org.uk/Stat e_Pensions/Living_Overseas/
(see under UK State Pension Annual Increases).
I'm not going to try and defend it - it's just the rules. It's little comfort but it has always been that way.
as far as i am aware, if you move abroad to certain destinations, your state pension is capped at the amount it was when you moved. Australia is one such place, and i would imagine from what you say ZA is too. As to why it is, i have no idea - perhaps because she is no longer a uk taxpayer? people who recieve a pension in the uk are still subject to tax depending on income so perhaps that is why
http://www.direct.gov.uk/en/MoneyTaxAndBenefit s/PensionsAndRetirement/MoneyInRetirement/DG_1 0014855
http://www.direct.gov.uk/en/MoneyTaxAndBenefit s/PensionsAndRetirement/MoneyInRetirement/DG_1 0014855
ok thanks both of you - yes between posting my Q and now I've been looking online and found the same as you both have. It is just not fair cos she worked here from the age of 15 till 63!!! but those are the rules. (PS - her pension DOES still get taxed - albeit not alot - just like anyone living here. Because she now is in frail care and her pension will no longer cover the (private) cost of this we may be forced to uproot her and TRY find her and NHS carehome here. This it will cost the government more to care for her here than an increase to her pension would!!! MADNESSi.
It makes me sooooo mad cos (and I KNOW I am opening up a political can of worms here!!) just last week I met a young lady who moved here from Nigeria in 2000. She is a single mum and she is beinghelped with housing and childcare but....she is ALSO being subsidised to go to college two days a week. I am all for bettering people but presuming she worked since she arrived (and I am not sure she did!!!!) then that is still ALOT less tax than my mum in law would've paid over all the years and she never claimed a single penny in benefits.....oh arrrghhhh I could go on and on and on.....but I'm just to P****ed off to do so.
NOTp***d off at the young sinlge mum but angry with the government who have different rules for different people!!!
It makes me sooooo mad cos (and I KNOW I am opening up a political can of worms here!!) just last week I met a young lady who moved here from Nigeria in 2000. She is a single mum and she is beinghelped with housing and childcare but....she is ALSO being subsidised to go to college two days a week. I am all for bettering people but presuming she worked since she arrived (and I am not sure she did!!!!) then that is still ALOT less tax than my mum in law would've paid over all the years and she never claimed a single penny in benefits.....oh arrrghhhh I could go on and on and on.....but I'm just to P****ed off to do so.
NOTp***d off at the young sinlge mum but angry with the government who have different rules for different people!!!
Evedawn. If you do consider uprooting your mum-in-law, you will find that it is very difficult for returning British Citizens. Lots of rules. You can find information by googling 'Returning British Citizens from South Africa'. I checked this in regard to my sister who lives in S.A., who wished to know what the situation would be if she wished to return to England. Sorry to hear of your family's predicament. Hope you can find a solution. Best wishes.
The UK has what are called Reciprocal Agreements with various countries. In some, this means the National Insurance or that other country's equivalent counts toward each other's benefit scheme. It also means that UK Stae Pension is increased if a person is a resident in certain countries.
The general rule though is that if a person in receipt of State Pension moves abroad, the pension stays the same. If you think about it, State Pension is increased each year to reflect the UK inflation rate and if you are not in the UK you are not affected by UK inflation.
The fact that someone has never claimed a benefit whilst in this country is ot a valid argument either.
The general rule though is that if a person in receipt of State Pension moves abroad, the pension stays the same. If you think about it, State Pension is increased each year to reflect the UK inflation rate and if you are not in the UK you are not affected by UK inflation.
The fact that someone has never claimed a benefit whilst in this country is ot a valid argument either.
As with most things like this, the question of �fairness� does not enter into the argument.
These problems arise because the State Pension scheme is regarded as a �benefit� and not as a pension in the accepted sense of the word. Most people in receipt of a State pension have paid into the scheme via their NI contributions. Many have paid far in excess of the amount that would be required to secure a pension equivalent to the State level had they paid into a private scheme. These same people receive the same (and often less) than those who have paid in little or nothing at all.
The result is not a pension scheme at all but a tax where the benefits paid bear little or no relationship to the contributions made. In fact it can be better described as a State run Ponzi scheme, where the payments made by current contributors are not invested for their future use but instead are used to pay current claimants.
The government only provides increases to pensioners living in the EEA or in a country with a reciprocal Social Security arrangement. No private pension provider could get away with denying to those recipients living abroad the increases paid to UK resident recipients with such an argument. They would swiftly end up in court.
The inflation rate argument put forward by TCL does not hold water. Pensioners in places such as Jamaica, Mauritius, Bermuda and Israel are certainly not subject to UK economic conditions, but they receive an annual increase nonetheless.
This situation will continue unless and until pensioners who have contributed to their State pension are treated as pension recipients and not Social Security claimants.
These problems arise because the State Pension scheme is regarded as a �benefit� and not as a pension in the accepted sense of the word. Most people in receipt of a State pension have paid into the scheme via their NI contributions. Many have paid far in excess of the amount that would be required to secure a pension equivalent to the State level had they paid into a private scheme. These same people receive the same (and often less) than those who have paid in little or nothing at all.
The result is not a pension scheme at all but a tax where the benefits paid bear little or no relationship to the contributions made. In fact it can be better described as a State run Ponzi scheme, where the payments made by current contributors are not invested for their future use but instead are used to pay current claimants.
The government only provides increases to pensioners living in the EEA or in a country with a reciprocal Social Security arrangement. No private pension provider could get away with denying to those recipients living abroad the increases paid to UK resident recipients with such an argument. They would swiftly end up in court.
The inflation rate argument put forward by TCL does not hold water. Pensioners in places such as Jamaica, Mauritius, Bermuda and Israel are certainly not subject to UK economic conditions, but they receive an annual increase nonetheless.
This situation will continue unless and until pensioners who have contributed to their State pension are treated as pension recipients and not Social Security claimants.
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