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State pension UK: Why you may miss out on increasing payment – full list of those affected | Personal Finance | Finance

The state pension is something which a person can receive once they reach state pension age – something which is currently rising. However, it’s down to the recipient as to whether they claim their state pension straight away, or whether they opt to delay (defer) it.

People who reach state pension age on or after April 6, 2016

Those in this situation will see their state pension increase each week they defer, provided this is for at least nine weeks.

It means the state pension increases by the equivalent of one percent for every nine weeks that it is deferred.

This equates to just under 5.8 percent for every 52 weeks.

When it comes to claiming the state pension, the extra amount is paid with the regular state pension payment.

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People who reached state pension age before April 6, 2016

In this situation, usually, the person can take their extra state pension either in the form of higher weekly payments, or as a one-off lump sum.

For the former, the state pension increases every week it’s deferred, as long as this is for at least five weeks.

It rises by the equivalent of one percent for every five weeks it’s deferred – working out at 10.4 percent for every 52 weeks.

This extra amount is then paid with the regular state pension payment upon claiming it.

Meanwhile, a one-off lump sum can be received if the person has deferred the state pension for at least 12 months in a row.

This payment will include interest of two percent above the Bank of England base rate.

However, those thinking about deferring their state pension need to be aware that they may miss out on building up the payment, should they receive certain other payments.

The government website says: “You cannot get extra State Pension if you get certain benefits.

“Deferring can also affect how much you can get in benefits.”

Gov.uk states that if a person gets certain benefits or tax credits, then they can’t benefit from the increase that can come with deferring.

It states: “You cannot build up extra State Pension during any period you get:

  • Income Support
  • Pension Credit
  • Employment and Support Allowance (income-related)
  • Jobseeker’s Allowance (income-based)
  • Universal Credit
  • Carer’s Allowance
  • Incapacity Benefit
  • Severe Disablement Allowance
  • Widow’s Pension
  • Widowed Parent’s Allowance
  • Unemployability Supplement.”

Additionally, a person can’t build up extra state pension during any period that their partner gets:

  • Income Support
  • Pension Credit
  • Universal Credit
  • Employment and Support Allowance (income-related)
  • Jobseeker’s Allowance (income-related).




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