Pension Credit Guarantee AND State Pension.

[silverlight]

If there is a claim for Pension Credit made, the amount of State Retirement pension is deducted from it. That seems totally logical to me.

 

If however you choose not to claim the pension for whatever reason AND make a claim for Pension Credit you cannot enhance the level of that pension either to obtain a future lump sum or an increase in the pension.

 

I then read that if you do not claim the pension AND claim Pension Credit, the amount of the pension you are deemed to be entitled to will be deducted from the Pension Credit award in any event?

 

As there appears to be a cut off of 12 months to make a claim for your pension, what I would like to know is:

 

If someone claims Pension Credit and does not make a claim for their State Pension for say 9 years and as you can only reclaim the past 12 months, what happens to the missing 8 years in that example?

 

I do hope that the answer isn't that the government take it?

 

The reason I ask is that the friend I am trying to advise appears to have this problem. I have tried to reconcile their total income, have looked at their Pension Credit award notice which shows a deduction for his wife's pension, yet she appears not to have claimed it for the past 9 years - she is 69 and older than my friend by 5 years.

The current deduction level is £64.27 per week.

They have an AIP that ends next February on the date of my friends 65th birthday.

 

In round figures she is owed approx. £30,000, which if the claim is only limited to 12 months, she would only receive approx. £3300 - it's the missing £26700 that I am concerned about.

Edited November 7, 2013 by silverlight

[honeybee13]

In round figures she is owed approx. £30,000, which if the claim is only limited to 12 months, she would only receive approx. £3300 - it's the missing £26700 that I am concerned about.

 

Yes, I can see that's a concern and it's kind of you to help her. Has your friend tried the CAB for example?

 

HB

[Invalidation]

If someone claims Pension Credit and does not make a claim for their State Pension for say 9 years and as you can only reclaim the past 12 months, what happens to the missing 8 years in that example?

 

Its given to poor MP's to heat their second homes,

(Or am I being cynical here?)

[silverlight]

In round figures she is owed approx. £30,000, which if the claim is only limited to 12 months, she would only receive approx. £3300 - it's the missing £26700 that I am concerned about.

 

Yes, I can see that's a concern and it's kind of you to help her. Has your friend tried the CAB for example?

 

HB

 

Thanks HoneyB once again.

 

I can only do what I can do unfortunately. Between us both it is akin to the 'Blind leading the blind'.

 

Yes CAB were contacted a while ago by my friend when he thought he had a problem but didn't realise how big a problem it was. All that they suggested was for her to apply immediately for her pension and ask for it to be backdated 12 months at least. As for the earlier years they simply don't have the staff to advise on that matter.

 

All of this has come about due to his illness and inability to deal with his wife's and his own financial affairs. What with the DLA problem and failure to deal with the refusal to award back in 2005 and the failure to deal with his wife's pension when she became 60 also at the same time.

 

My own analysis of the problem, and assuming the worst (that no monies will be paid by the DWP for both situations) it is looking like a loss of £26700 of State Retirement pension plus the loss of the DLA award which by my own calculations adds up to another approx. £31200.

 

I cannot believe that there aren't many others in this same situation with what appears to be a cynical way of reducing payments to eligible people in the interest of reducing the Welfare budget. I think that Mr Osbourne should send a letter of thanks to my friend for the generosity of 'donating' something like £58,000 of entitlement to the Welfare Budget pot!!

 

I shall plod on asking questions of anybody and everybody in the hope that some light may be shed on a possible solution.

Edited November 8, 2013 by silverlight

[silverlight]

Its given to poor MP's to heat their second homes,

(Or am I being cynical here?)

 

Thanks, no I don't think you are being cynical. I doubt very much that any MP would find themselves in this same position of having not claimed £58,000 when it was there for the asking!! Maybe a new duck house??

[stigofthedump]

Have you rang The Pension Advisory Service - I had an online chat with them about claiming an ill health pension from my previous employer and they were very helpful and worked out rough figure on how much tax I would pay etc. I have just got ESA Support Group so they felt I should apply for ill health pension as ESA is £106 per week but then pension would be £300 per week . Give them a try

[stigofthedump]

On Pension Advisory Service home page look at second column from right, hallway down page there is a brown contact us box and below the phone number and email there is web chat - click on that if you don't want to call an 0845 number - its live online chat 9-5 weekdays

[Surfer01]

Where any of them receiving any income in the past 8 years as this is deducted from the Pension Credit even if it is an occupational pension? What other benefits did they receive in the 8 years? If they have been making the deduction incorrectly for the 8 years, then the full amount would have to be refunded without the 12 month cut off limit.

[silverlight]

Where any of them receiving any income in the past 8 years as this is deducted from the Pension Credit even if it is an occupational pension? What other benefits did they receive in the 8 years? If they have been making the deduction incorrectly for the 8 years, then the full amount would have to be refunded without the 12 month cut off limit.

 

Thank you

 

Yes they were receiving other income during the period and it was deducted before the Pension Credit payment was made. Pension credit was a 'top up'.

 

The Pension Credit payments, it now appears, were showing a deduction for the State Pension that had not been claimed. It seems that they are allowed to do this automatically.

 

My only chance for them to recover some of this money is to hope that the Pension service will treat it as a deferral and either increase what they have now claimed or pay it as a lump sum.

 

However from what I have read, since 2010 this is not possible and any pension not claimed and it has been used to reduce the level of Pension Credit will be lost. I'm just hoping that prior to 2010, this wasn't the case.

[Surfer01]

If they made the deduction it is an "official mistake" and they should be able to reclaim as there was a physical deduction. I would think the difference would be if it was never claimed for at all. I think the best bet is to speak to someone at CAB or a person with more knowledge in benefits and pensions.

[silverlight]

If they made the deduction it is an "official mistake" and they should be able to reclaim as there was a physical deduction. I would think the difference would be if it was never claimed for at all. I think the best bet is to speak to someone at CAB or a person with more knowledge in benefits and pensions.

 

Bit of an update

 

The latest 'advice' that was received today from the Pension Service was that they are right!!!

 

The pension income is quite rightly deducted in the Pension Credit calculations on the basis that it is deemed to have been claimed and is in payment. If for some reason that it wasn't claimed then that is entirely the choice of the person concerned. They say that you cannot choose between having Pension Credit over claiming the State Pension.

 

The pension is there for the claiming and it is assumed that such a claim has been made.

 

And yes, they were right, you can only backdate a State Pension claim for 12 months. The other 8 years have now been lost and cannot be paid. 'Complaining now about money that she was entitled to but didn't claim is down to her and nobody else!'

[vengeancedemon]

Most Interesting thread, and food for thought thank you

 

A quick question, I currently receive guaranteed Pension Credit, and in a years time I am eligle for State Pension, is it best to consult PensionService nearer the date for best option or??

[silverlight]

Most Interesting thread, and food for thought thank you

 

A quick question, I currently receive guaranteed Pension Credit, and in a years time I am eligle for State Pension, is it best to consult PensionService nearer the date for best option or??

 

From what I have managed to get out of the Pension Service is that they will write to you (here's hoping that the letter is delivered!) about 3 months before the pension is due to be paid. It is then up to you as to whether you want to claim it or not. Whatever you do, the Guaranteed Pension Credit will be revised from when the pension is payable on the basis that you are receiving it. If you choose not to claim it not only will you have a reduced Guaranteed Pension credit award but if the pension remains unclaimed after 12 months you will lose it altogether - you can only get 12 months backdated. So if you feel generous towards the government and want your pension to go to a better home, don't bother claiming it!!

 

It seems that up until 2010, if you put off claiming your pension you could get it enhanced when you did claim it - that was stopped. Now it is as simple as claim it or lose it!

 

We will never know how many people do actually lose out in this way but I know one that has in a rather big way - £25,000!! I didn't realise that you don't get your state pension if you fail to ask for it. I thought that it was paid automatically on reaching retirement age. I wonder how many others think the same?