The 6 April State Pension changes: All you need to know
The State Pension is changing. Below is a breakdown of the key things you need to know, as well as links to resources that you may find helpful.
When am I eligible?
If you reach State Pension age on or after 6 April, your State Pension will be a regular payment of £155.65 per week from the government. If you reach State Pension age before 6 April 2016, you will receive the State Pension under the current scheme.
Use this calculator to see when you will reach State Pension age.
How much State Pension will I get?
Those over the age of 55 can request a pension statement that will give an estimate of how much State Pension they have earned so far.
Be aware that the amount represented by this statement is an estimate, and not a guarantee. It is based on an individual’s current National Insurance record, and does not take into account future contribution years.
Some people will be entitled to a greater pension than the new minimum of £155.65. If this applies, the additional entitlement will be protected and will rise by CPI rather than the triple lock guarantee, as is the case with the standard State Pension.
Use this form to get your State Pension statement.
How is what I am entitled to worked out?
Your National Insurance record before 6 April 2016 will be used to calculate your new State Pension. Usually you will need to have 10 qualifying years on your record to guarantee some sort of payment, though you will require 35 qualifying years to get the State Pension in full.
If you want to increase your State Pension amount, you may be able to pay voluntary National Insurance contributions. Similarly, you may be able to make voluntary payments if you have gaps in your National Insurance record.
What if I’m not working?
If you claim Child Benefit for a child under 12, get Jobseeker’s Allowance or Employment and Support Allowance, or get Carer’s Allowance, you may get National Insurance credits that will count towards your State Pension.
What if I am currently contracted out?
From 6 April 2016, you will not be able to contract out of the Additional State Pension. If you are currently contracted out, you may find that you end up paying more National Insurance from 6 April, because those who are contracted out pay National Insurance at a lower rate.
The only people that have been able to be contracted out since 2012 are those whose employer runs a contracted out pension scheme.
You can generally tell if you are contracted out by taking a look at your payslip. If the section relating to National Insurance contributions is marked with the letter D or N then you are contracted out. If it is marked with an A, you are not.
Your pension will be reduced if you are contracted out of the Additional State Pension, however you will be able to increase your pension up to the full level.
If you are contracted out and would like additional information, view the Government’s ‘contracting out’ factsheet.
Can I defer payments?
If you reach State Pension age and then decide, for whatever reason, not to start taking your money immediately, you could get extra State Pension when you finally decide to claim. For every nine weeks you defer, your State Pension will increase by 1%. This works out at around 5.8% for every full year you put off claiming.
Can State Pension be inherited?
You may be able to inherit an extra payment if you are widowed, but not if you remarry or form a new civil partnership before reaching State Pension age.
If your partner died while they were deferring their State Pension, had reached State Pension age before 6 April, or you were married/in a civil partnership when they died, you may inherit part or all of their State Pension.
What happens if I retire overseas?
In most instances you will be able to claim the new State Pension if you move overseas. However, your State Pension may be affected if your circumstances change. For more information, you may benefit from speaking to the International Pension Centre.
What if I have other pensions?
If you also have a private and/or workplace pension, you may benefit from a discussion with an independent financial adviser. VouchedFor can help you find a rated adviser in your area.
If you require further information, visit the Pensions Advisory Service or view the Government’s factsheet