marie-claire

I looked into this recently and found that if you are working in oz then you can pay the class 2 contributions whichg are roughly £2.50 per week. If you are not working but still want to pay contributions then you have to pay class 3 which is around £12 per week. (big difference).

If you pay class 3, but then start working, you can drop down to paying class 2 contributions.

It may be worth it if you only have a few years left before reaching the 30 years that you have to contribute. Get a pension forecast, Department of work and pensions website will give you telephone numbers etc.

Worth knowing that if for example your pension was worth £60 per week now. It will be frozen at that level even though your contributions will probably rise each year with inflation. Meaning, if you stayed in UK, when you reach pension age it may be worth £130 per week, but if you stay in oz then you will still only get the £60 even though you have paid the contributions.

Hope this helps.

marie-claire

website address www.dwp.gov.uk

Grayling

Wrong.

It is frozen at the level it is when you first recieve it......not when you leave the country.

louie

I don't think that's quite right. You get the full amount to which you would be entitled if you claimed in the UK when you reach retirement age, but thereafter it is not increased. So if it's worth £130 then, you would get £130 forever rather than it increasing annually thereafter. At least, that's my understanding.

(Beaten to it by Grayling!)

perksy

Aren't the tories proposing a policy should they get in to cancel all expat pensions? I'm sure I've read it somewhere

ABCDiamond

I think they want to unfreeze it..... There are a million potential voters in Australia

perksy

Could work in reverse though. Cameron could argue that there will be more money in the kitty for those actually residing in the UK, instead of it being sent abroad.

Reasonable

[Q To give you a guide I'm 43 this year and I won't get my pension until I'm 66. My wife is 40 this year and won't get her pension until she's 67.

[/QUOTE]
My guess is that the UK state pension will be means tested well before then

EvannTel

I'm intrigued by your comment that you only need one year NI contribs to get some pension.

This page still says 11 years normally

This link says you have to be in UK to pay Class 2 so I'd be interested to know how you have managed this.

Ta

louie

Have a look at this booklet - http://www.hmrc.gov.uk/pdfs/nico/ni38.pdf

tony Beaven

Hi Rob

Just finally picking up on the expat site

email HMRC in the uk and ask for online a form BR19 which is a state pension forcast and also inform them of your new address in Aus

they will then inform you of any shortfall and timescales for making up voluntary contirbutions

not sure if you are already retired or working but another area to consider is transfers and my god will you be hammered on this from schemes in aus

usually you have a 6 month window to transfer over pension schemes in the uk free from tax although with current economic conditions here are a couple of rulings if you go over the 6 month rule

basically you have two options you can either pay 15% tax on the amount transferred over as contribution tax or you can elect to have the difference in growth in the fund from the date you entered the country to the transfer date classedas assesable income and taxedat yor marginal rate

now a thought with world stockmarkets down if you entered Australia the ATO take the date you entered the country for the first base of their calculationand then tke the date of transferas their next basis of calculation

so effectively if your pension fund lost money between the date you entered Australia permenantly and the date of transfer it would be wise to elevt to have the growthbased on assesssable income which would be no growth in the fund and therefore not tax to pay asthe aussies would say you beauty

regards

Tony

this will save you thousands

MartinLuther

That's one of the reasons I didn't bother with voluntary contributions. They are one of the worst superfund managers I've seen

Also, it already is means tested to a degree. The pension pays out less than the minimum 'something or other' and the top up is means tested. I think they will continue to increase the difference between what the pension pays and the minimum guarantee.

MartinLuther

The changes are for people who will receive their pension after 6 April 2010. Have a look at page 22 of this http://www.pensions.gov.uk/pdf/pm/pm2jan09.pdf

They changed the rules in about 2004/5(?) so that people working overseas could pay class 2. They did not make a big announcement about this. Have a look at the link provided by louie.

Personally I don't pay either. I think the class 2 contributions are marginal in consideration of the benefit with a big risk that the government will screw you in the future. Class 3 is a complete rip off.

The one positive is that my 20 something years of contributions are now worth more than they were when I left.

yafm11

It is frozen to the level it is given to you when you reach retirement age. For instance next door neighbours were getting small pension from his working when he was a teenager in the 60's his wife also got a part pension when he died she got her pension upgraded without asking as she got the then level of widows pension.

When my husband reached retirement age after we had got here my pension I was already receiving was changed to his level as it was then a part of his pension not my own.

BristolUK

But that's quite a gain though. If it's 20 years, the rule change would turn about £50 into about £66 (current figures)...that's over 30% more.

In my case, when I left I expected about 73% but the new rule means it'll be 100%.

On current figures that's nearly £100 instead of £70. That extra £30 a week would more than pay my groceries here.

I'm viewing it as compensation for not getting the annual increases.