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Occupational Pension and C.B.E.S.A ...
Hello All
Have a client who is in receipt of C.B.E.S.A and would like to defer their occupational pension of approx. £5.000.00 per annum because they have not reached state pension age.
This equates to £96.15 per week which is just above the £85.00 disregard.
However, can the client defer the pension until state pension age or could the DWP say the client had deprived themselves of income and, or treat them as having notional income.
CPAG pages 616 is not clear and I can’t find anything else that states what the effect, if any, would be if the client defers their pension.
I feel that because it is a contributory benefit rather than a means tested one the client can defer the pension without any adverse effect on them but ???
Any thoughts etc, much appreciated :)
Pete
I think this is actually covered at p.284 Robin, under the notional income rules.
See the sixth bullet point down which covers what happens (or doesn’t happen) if someone under PC-qualifying age does not take income from personal and occupational pensions.
So your client should be fine for now.
Not taking a pension has no effect on working age benefits. Taking something, whether income or capital, will be taken into account, net of tax, although there will still be no notional income calculation for anything not taken.
Once QASPC is passed then anything taken will be taken into account, net of tax, and anything untaken will generate a notional income.
Because pension savings are treated differently to other savings, such as cash or ISAs, people need to be very cautious, especially under pension age, about moving their savings into another form, such as buy to let, which will immediately be taken into account. Why pension savings are treated differently is a question which is being asked a lot more now that they don’t have to be used to buy an annuity any more.
Thank you gentlemen
As ever, a speedy and most helpful response which is most helpful ...
enjoy the rest of your weeks and again, cheers !
Pete