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Expat pensions could be frozen post-Brexit

Expat pensions could be frozen post-Brexit

Old Dec 8th 2018, 8:57 am
  #16  
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Default Re: Expat pensions could be frozen post-Brexit

Originally Posted by bobd22
The government sets the rate of pay you have to pay in NI towards state pension health care etc. So how is that a low contribution ? You pay what they take out of your pay in the belief (back then) that at 60 female 65 male you would get full state pension. If you paid then you should get what was promised. However many recent changes have allowed government to get out of that promise in various ways. Maybe you are one of the people that believe state pension is a benefit as some in government do? It's not it's a right as we paid in and should get out what we were promised.
Unfortunately that is not how the state pension was and is set up in law. Unlike a private pension which builds a fund which is drawn down after retirement (and is supported by investment and interest). The NI contribution (and other taxes) pay for current pensions and benefits. As you say you were promised a certain pension when you retired and I am sure that's about what to got. The problem is that it is no longer indexed as of right but only in certain territories which have a bilateral agreement with the UK to continue the subsidy. If you leave the UK you are no longer contributing economically to the UK but to your new host country. Spain and others seems to recognise this and that their citizens will also benefit in the UK so a reciprocal bilateral deal is very likely. If you want to blame someone then if you are not getting an indexed pension then you should blame your host country and not the UK.
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Old Dec 8th 2018, 9:01 am
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Default Re: Expat pensions could be frozen post-Brexit

I (& many others) pay UK taxes but do not use UK services (or clog up the roads, take up accommodation, bed block the NHS, etc).
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Old Dec 8th 2018, 10:35 am
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Default Re: Expat pensions could be frozen post-Brexit

It is worth noting that all UK state pensioners, using the S1 system, receive full Spanish healthcare. This is funded directly to Spain by the UK and the current cost is around €4000 per person per year.
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Old Dec 8th 2018, 11:15 am
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Default Re: Expat pensions could be frozen post-Brexit

Originally Posted by Fred James
It is worth noting that all UK state pensioners, using the S1 system, receive full Spanish healthcare. This is funded directly to Spain by the UK and the current cost is around €4000 per person per year.
That is a good point Fred, let’s hope it remains even with this new Micky Mouse free healthcare for all stunt.
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Old Dec 8th 2018, 12:41 pm
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Default Re: Expat pensions could be frozen post-Brexit

Originally Posted by Expatrick
I (& many others) pay UK taxes but do not use UK services (or clog up the roads, take up accommodation, bed block the NHS, etc).
Neither do you spend your income in the UK thereby paying tax (VAT etc) and buying goods which generate income and jobs for others who in turn pay tax thereby supporting the UK economy. You buy things, pay rent and taxes, use the roads etc etc in your host country, thereby supporting its economy.

PS: If you are resident overseas then why are you still paying tax in the UK? At the very least you should be setting it off against Spanish tax under the Tax bilateral? (another reason you shouldn't still expect the UK to continue to pay benefits )

Last edited by MikeJ; Dec 8th 2018 at 12:45 pm.
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Old Dec 8th 2018, 12:48 pm
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Default Re: Expat pensions could be frozen post-Brexit

Originally Posted by MikeJ
Neither do you spend your income in the UK thereby paying tax (VAT etc) and buying goods which generate income and jobs for others who in turn pay tax thereby supporting the UK economy. You buy things, pay rent and taxes, use the roads etc etc in your host country, thereby supporting its economy.

PS: If you are resident overseas then why are you still paying tax in the UK? At the very least you should be setting it off against Spanish tax under the Tax bilateral? (another reason you shouldn't still expect the UK to continue to pay benefits )
Government pension - can't be moved out of the UK.
ETA: Not in Spain by the way. Yes I know this is the Spanish forum but the thread title encompasses all EU expats.
​​​​​

Last edited by scrubbedexpat142; Dec 8th 2018 at 1:05 pm.
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Old Dec 8th 2018, 12:54 pm
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Default Re: Expat pensions could be frozen post-Brexit

Originally Posted by MikeJ
Unfortunately that is not how the state pension was and is set up in law. Unlike a private pension which builds a fund which is drawn down after retirement (and is supported by investment and interest). The NI contribution (and other taxes) pay for current pensions and benefits. As you say you were promised a certain pension when you retired and I am sure that's about what to got. The problem is that it is no longer indexed as of right but only in certain territories which have a bilateral agreement with the UK to continue the subsidy. If you leave the UK you are no longer contributing economically to the UK but to your new host country. Spain and others seems to recognise this and that their citizens will also benefit in the UK so a reciprocal bilateral deal is very likely. If you want to blame someone then if you are not getting an indexed pension then you should blame your host country and not the UK.
i understand what you say and of course we had no choice in the fact that we all had to pay National Insurance contributions from our earnings. However the fact it wasn't invested in any way was not in our control. In a private pension that may be factor we would take into account before investing. Im sorry and you may disagree and government may legally be able to wriggle out of it but for most how I described is what they thought when they started paying NI, it was believed paying for our healthcare and future state pension. We now find out that as we approach the time of drawing the promised pension, the finish line has been moved . If you take early retirement in the UK and live off private pension or savings you longer contribute to NI other than for some to top up state pension contributions for state pension years voluntarily. We can't alter it and will have what we have same will apply re pension rises if there is no deal done it will depend on reciprocal agreements being made or not we must wait and see or hope some sort of deal re Brexit is actually done or the whole thing is put in file 13. I often find that those that have the view that recent (since 2010) changes to UK State pension are fair etc are those that actually received at the time they believed they would i.e. 60 and 65.

Last edited by bobd22; Dec 8th 2018 at 1:04 pm.
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Old Dec 8th 2018, 1:13 pm
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Default Re: Expat pensions could be frozen post-Brexit

Originally Posted by MikeJ
PS: If you are resident overseas then why are you still paying tax in the UK? At the very least you should be setting it off against Spanish tax under the Tax bilateral? (another reason you shouldn't still expect the UK to continue to pay benefits )
So you believe State Pension is a benefit? Sorry but if I contribute to something it should not be referred to as a benefit. The Department controling it has the word pensions in its title so it should be referred to as such. I have to pay UK tax for life on my government pensions for rest of my life so disagree with your comment on being a tax payer also
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Old Dec 8th 2018, 2:03 pm
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Default Re: Expat pensions could be frozen post-Brexit

It’s not as straight forward as that. If you have paid into UK system you will be entitled to a state pension no matter where you live. I do not see that as a state benefit handout. But if you have been a dole Waller all your life or a non contributing foreigner you will need to claim Pension Credit (nice title), that is a benefit handout paid only in the UK as far as I am aware. In any event a worker or long term sticky mattress disease person or non contributing foreigner you will receive up to £125.95 per week in the UK. I don’t think you will get sticky mattress benefit if you are in Spain. There is more detailed criteria regarding Transgender people etc. See https://www.gov.uk/state-pension

It would seem that currently it does not matter a toss if you pay in or not providing you don’t want to live in a villa in Spain at retirement age. It would be interesting to know how the same person (who never paid a bean in) would stand in Spain? for any type of Spain state pension payment.
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Old Dec 8th 2018, 2:19 pm
  #25  
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Default Re: Expat pensions could be frozen post-Brexit

Originally Posted by bobd22
The government sets the rate of pay you have to pay in NI towards state pension health care etc. So how is that a low contribution ?
Paying £2.95 a week seems like a pretty good deal to me, I'd call that low personally compared to those in the UK paying Class 4 contributions on their earnings.
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Old Dec 8th 2018, 2:28 pm
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Default Re: Expat pensions could be frozen post-Brexit

Originally Posted by christmasoompa
Paying £2.95 a week seems like a pretty good deal to me, I'd call that low personally compared to those in the UK paying Class 4 contributions on their earnings.
Yes, but that's only one specific circumstance. The scenario originally raised is that of all (EU) expat pensions being frozen after brexit. Furthermore there are those in the UK who fall into the category you describe (I have 3 in my own family) whose pensions will not be frozen. The real argument seems to be down to the relative, economic benefits of being in the UK, or not.
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Old Dec 8th 2018, 3:00 pm
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Default Re: Expat pensions could be frozen post-Brexit

Originally Posted by Expatrick
Yes, but that's only one specific circumstance. The scenario originally raised is that of all (EU) expat pensions being frozen after brexit. Furthermore there are those in the UK who fall into the category you describe (I have 3 in my own family) whose pensions will not be frozen. The real argument seems to be down to the relative, economic benefits of being in the UK, or not.
The difference is those 3 in your family are contributing to the UK system in other ways i.e. VAT, road tax, tax on fuel, etc.

But in any event, I was specifically referring in my original post to those that have left the UK when young (or even youngish), and then just paid the Class 2 rate for years, yet still get the same pension initially as those paying full NI contributions in the UK. I was just pointing out that not everybody living abroad will have contributed the same as those who have worked in the UK until retirement.
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Old Dec 8th 2018, 3:28 pm
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Default Re: Expat pensions could be frozen post-Brexit

Originally Posted by bobd22
So you believe State Pension is a benefit? Sorry but if I contribute to something it should not be referred to as a benefit. The Department controling it has the word pensions in its title so it should be referred to as such. I have to pay UK tax for life on my government pensions for rest of my life so disagree with your comment on being a tax payer also
Isn't it simply that in the longer term with an ageing population state and public sector pension costs will become unsustainable and that has to be recognised sooner rather than later.
I see this as a far bigger risk to the long term economy than brexit.

Last edited by Rosemary; Dec 11th 2018 at 1:54 pm. Reason: corrected quote
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Old Dec 8th 2018, 3:29 pm
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Default Re: Expat pensions could be frozen post-Brexit

I simply speak for myself started work at 15 took early retirement at 59 paid full class 1 NI contributions from I believe it was 16th birthday as under that age I seem to remember you didn't pay NI? Admittedly first years wouldn't amount to much as my weekly apprentice pay was £3- 5 shillings but I would have paid whatever the % set I believe that is now 12%. Yes some may have paid less by being in a different NI band dependant on their situation. All I know is my last pay slip from memory amounted to around £340 per month NI. I now have to wait 6 months past 65 to draw my state pension and when I get it they reduce it by around £35 per week because I have government pensions and unbeknown to me I paid I believe 11% or so NI not 12.? So lose around £140 per month pension. As John says had I never bothered to get out of bed and lived of the magic benefit I would get the full single tier pension of over £160 per week and no doubt extras on top. That's because those of us that did work paid their contributions to NI from our contributions! But no point being bitter the great government seem to give us what they see fit whether we have paid in or not same will apply regarding annual increases should there be no Brexit deal. It comes down to whether those in government can be bothered to negotiate reciprocal agreements. Given the way the Brexit fiasco has gone so far why should we worry??😣😣😂😂

Last edited by bobd22; Dec 8th 2018 at 3:32 pm.
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Old Dec 8th 2018, 3:45 pm
  #30  
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Default Re: Expat pensions could be frozen post-Brexit

Originally Posted by christmasoompa
Paying £2.95 a week seems like a pretty good deal to me, I'd call that low personally compared to those in the UK paying Class 4 contributions on their earnings.
I thought the new universal pension was around £150 per week ???
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