Not claimed State Pension

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  • #22023
    valbaker
    Participant

    We have a claim where the wife (partner) has never claimed her state pension although she is 63. I don’t think we do, but does anyone know whether we should treat the amount not claimed as notional income?

    #6397
    markp
    Participant

    You should, unless it is a deferred pension. At least that’s how I understand it.

    Do I know what I'm doing? The jury's out on that........................

    #6398
    Anonymous
    Guest

    Right at moment Mark, see HB 60+ regs 36 (various parts). 8)

    #6399
    Anonymous
    Guest

    Reg 41(1) (new version) says that notional income includes any unclaimed “retirement pension income”, with the exception of items listed in para (2). Para (2) refers to Cat A and Cat B Retirement Pension where entitlement has been deferred; and para (3) defines “deferred” as having the meaning in s55(3) of the Contributions and Benefits Act.

    What Mark says is true on the face of it: State Retirement Pension is included as notional income unless the claim is deferred (or so you would think), but if you follow up the s55(3) reference you will find that deferral is done in two ways: either you make a declaration that you wish to defer your claim, or you simply don’t bother claiming: failure to claim, or to pursue an incomplete claim, amounts to de facto deferral. So in the case described, you would NOT take notional income into account.

    So what is Reg 41(1) for then? How can you have notional “retirement pension income” if there are no practical circumstances in which it applies?

    The answer is in the definition of the term “retirement pension income”. This is wider than state pension: it means anything defined as retirement pension income for Pension Credit purposes (see definition in Reg 29). This term applies to anything that is fixed during an AIP.

    So to sum up, unclaimed State Retirement Pension can never be notional income (actually, there might be some cases for the next couple of years where the pension has been unclaimed for longer than 5 years where it would be notional income, but I won’t bore you any further – in all plausible circumstances, RP isn’t notional income)

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