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Government stabs UK expat pensioners in the back again
| Published: | 4 Jun at 6 PM |
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Thousands of UK state pensioners living overseas are likely to lose out due to the recent changes in state pension legislation.
Overseas UK citizens who planned and took their early retirement well before its UK due date are finding their calculations are in tatters as they may no longer be entitled to a full UK pension. Formerly, 30 years of National Insurance contributions entitled those reaching pension age to the full amount, but the government has now hiked the contribution period to 35 years.
Many of those relying on a full state pension under the old qualifying period will now be forced to accept a lesser amount. According to the Pensions Advisory Service, the impact of the new rule will depend on their age at the time their pension payments commence.
For example, if a man reaches retirement before 6 April 2016 and has 30 qualifying years’ NI contributions, he will receive his full pension. Those retiring after that date will have their payment calculated using the 35 qualifying year rule, and would need to buy more qualifying years to receive the full amount.
For those living in Australia, Canada and other countries where UK state pensions are frozen from the migrant’s date of arrival, this means that the amount receivable will be frozen at the lower rate unless more qualifying years are purchased. According to the UK government, all expats will have known the state pension rules before they left the UK and should plan their budgets accordingly.
Perhaps the government should have given the same advice to the many thousands of UK retirees living in colder parts of the EU who have recently lost their entitlement to the cold weather payment. It seems that the perceived Westminster attitude that expat pensioners are unimportant as they don’t bother to vote has claimed even more victims.
Overseas UK citizens who planned and took their early retirement well before its UK due date are finding their calculations are in tatters as they may no longer be entitled to a full UK pension. Formerly, 30 years of National Insurance contributions entitled those reaching pension age to the full amount, but the government has now hiked the contribution period to 35 years.
Many of those relying on a full state pension under the old qualifying period will now be forced to accept a lesser amount. According to the Pensions Advisory Service, the impact of the new rule will depend on their age at the time their pension payments commence.
For example, if a man reaches retirement before 6 April 2016 and has 30 qualifying years’ NI contributions, he will receive his full pension. Those retiring after that date will have their payment calculated using the 35 qualifying year rule, and would need to buy more qualifying years to receive the full amount.
For those living in Australia, Canada and other countries where UK state pensions are frozen from the migrant’s date of arrival, this means that the amount receivable will be frozen at the lower rate unless more qualifying years are purchased. According to the UK government, all expats will have known the state pension rules before they left the UK and should plan their budgets accordingly.
Perhaps the government should have given the same advice to the many thousands of UK retirees living in colder parts of the EU who have recently lost their entitlement to the cold weather payment. It seems that the perceived Westminster attitude that expat pensioners are unimportant as they don’t bother to vote has claimed even more victims.
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