Social Security transfer from USA to UK
#1
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Joined: Oct 2011
Posts: 1
Social Security transfer from USA to UK
I worked in the UK for 10 years before moving with my family to the USA in 1980 where I worked for 20+ years.
I returned to retire to the UK in 2006 and in 2008 at age 60 applied for my UK State Pension. This was calculated using my contributions, contributions made by my ex-husband and buying back previous years' contributions for which I paid out about £7000.
Last month I applied for my USA pension and was told that because of my UK pension, my USA pension would be almost halved. Is this correct? It seems ludicrous that I would have been better off had I no UK pension at all and having to pay £7000 for the privilege...!!
I would be grateful for any advice as to what I should do.
Jayjay123
I returned to retire to the UK in 2006 and in 2008 at age 60 applied for my UK State Pension. This was calculated using my contributions, contributions made by my ex-husband and buying back previous years' contributions for which I paid out about £7000.
Last month I applied for my USA pension and was told that because of my UK pension, my USA pension would be almost halved. Is this correct? It seems ludicrous that I would have been better off had I no UK pension at all and having to pay £7000 for the privilege...!!
I would be grateful for any advice as to what I should do.
Jayjay123
#2
Re: Social Security transfer from USA to UK
I worked in the UK for 10 years before moving with my family to the USA in 1980 where I worked for 20+ years.
I returned to retire to the UK in 2006 and in 2008 at age 60 applied for my UK State Pension. This was calculated using my contributions, contributions made by my ex-husband and buying back previous years' contributions for which I paid out about £7000.
Last month I applied for my USA pension and was told that because of my UK pension, my USA pension would be almost halved. Is this correct? It seems ludicrous that I would have been better off had I no UK pension at all and having to pay £7000 for the privilege...!!
I would be grateful for any advice as to what I should do.
Jayjay123
I returned to retire to the UK in 2006 and in 2008 at age 60 applied for my UK State Pension. This was calculated using my contributions, contributions made by my ex-husband and buying back previous years' contributions for which I paid out about £7000.
Last month I applied for my USA pension and was told that because of my UK pension, my USA pension would be almost halved. Is this correct? It seems ludicrous that I would have been better off had I no UK pension at all and having to pay £7000 for the privilege...!!
I would be grateful for any advice as to what I should do.
Jayjay123
Essentially, though, what you describe sounds about right. The only way to be exempt from the WEP as far as I know is if you had 30 years of SS payments.
#3
Re: Social Security transfer from USA to UK
I'm not familiar wiith the exact way this works, but try an advanced search on the USA and MBTTUK forums for threads containing the term "WEP" or "windfall elimination provision" - you'll find a lot of previous threads explaining and discussing this. You could Google these terms also, but you'll probably find it easier to read the explanations on here first.
Essentially, though, what you describe sounds about right. The only way to be exempt from the WEP as far as I know is if you had 30 years of SS payments.
Essentially, though, what you describe sounds about right. The only way to be exempt from the WEP as far as I know is if you had 30 years of SS payments.
if you have 30 or more years the windfall elimination doesn't apply, but less means they deduct for other pensions you are receiving.
#4
Re: Social Security transfer from USA to UK
If you look down a couple of pages of this article, you will see an explanation of WEP.
http://www.washingtonpost.com/wp-srv...arp061405.html
http://www.washingtonpost.com/wp-srv...arp061405.html
#5
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Joined: Oct 2011
Location: UK
Posts: 745
Re: Social Security transfer from USA to UK
WEP applied to US SS applies to anyone in US or overseas that receives any pension that was not subject to Social Security tax when the pension was earned.
So whether it is a UK pension or a US sourced pension from income that did not contribute to SS (for instance a state or local government retirement scheme for teachers) then it gets WEP'd.
Fair, no, we earned the two pensions so we should receive them but we get penalized by the US in their attempts to slow down the shrinking of the US SS pot.
So whether it is a UK pension or a US sourced pension from income that did not contribute to SS (for instance a state or local government retirement scheme for teachers) then it gets WEP'd.
Fair, no, we earned the two pensions so we should receive them but we get penalized by the US in their attempts to slow down the shrinking of the US SS pot.
#6
Re: Social Security transfer from USA to UK
"Social Security benefits are intended to replace only a percentage of a worker’s pre-retirement earnings. The way Social Security benefit amounts are figured, lower-paid workers get a higher return than highly paid workers. For example, lower-paid workers could get a Social Security benefit that equals about 55 percent of their pre-retirement earnings. The average replacement rate for highly paid workers is about 25 percent.
Before 1983, people who worked mainly in a job not covered by Social Security had their Social Security benefits calculated as if they were long-term, low-wage workers. They had the advantage of receiving a Social Security benefit representing a higher percentage of their earnings, plus a pension from a job where they did not pay Social Security taxes. Congress passed the Windfall Elimination Provision to remove that advantage."
#7
Re: Social Security transfer from USA to UK
I worked in the UK for 10 years before moving with my family to the USA in 1980 where I worked for 20+ years.
I returned to retire to the UK in 2006 and in 2008 at age 60 applied for my UK State Pension. This was calculated using my contributions, contributions made by my ex-husband and buying back previous years' contributions for which I paid out about £7000.
Last month I applied for my USA pension and was told that because of my UK pension, my USA pension would be almost halved. Is this correct? It seems ludicrous that I would have been better off had I no UK pension at all and having to pay £7000 for the privilege...!!
I would be grateful for any advice as to what I should do.
Jayjay123
I returned to retire to the UK in 2006 and in 2008 at age 60 applied for my UK State Pension. This was calculated using my contributions, contributions made by my ex-husband and buying back previous years' contributions for which I paid out about £7000.
Last month I applied for my USA pension and was told that because of my UK pension, my USA pension would be almost halved. Is this correct? It seems ludicrous that I would have been better off had I no UK pension at all and having to pay £7000 for the privilege...!!
I would be grateful for any advice as to what I should do.
Jayjay123
Last edited by nun; Nov 3rd 2011 at 10:57 am.