State pension UK: Protected payment rules explained – how much income will you receive?

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State pension payments are awarded to those who are at least 66 years of age and have a minimum of 10 years of National Insurance contributions under the new rules. While the full new state pension amount is £175.20 per week, what will actually be received may be affected by when the claimant worked and retired.

National Insurance records built up before April 6 2016 will be used to calculate a state pension “starting amount”.

This starting amount will be paid as part of the new state pension and it will be the higher of either:

The amount the claimant would get under the old state pension rules (which includes basic state pension and additional state pension)

The amount they would get if the new state pension had been in place at the start of their working life

The starting amount will include a deduction if the claimant was contracted out of the additional state pension.

A person may have been contracted out if they were in certain types of workplace, personal or stakeholder pensions when they were working.

If a person’s starting amount is less than the new state pension, they may be able to boost it by adding more qualifying contributions to their National Insurance record.

So long as the payments are qualifying, each National Insurance year added to a record after April 5 2016 will boost state pensions by about £5 a week.

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Starting amounts may end up being higher than the full new state pension and these payments will be known as a “protected payment”.

This will be paid on top of the full new state pension.

Regardless of what a person receives from their state pension, the awarded amounts will rise every year under triple lock rules.

These rules ensure state pension payments increase every year by the highest of 2.5 percent, average earnings or CPI rises.

A person can actually claim their state pension up to four months before reaching state pension age.

This is important to note as state pensions will not be paid automatically, they’ll need to be claimed.

The Government notes the quickest way to do this is by going online.

However, state pensions can also be claimed over the phone or through the post.

How a state pension is paid will be dependent on the claimants specific National Insurance number.

The last two digits of the number will determine what day of the week the payments arrive, as detailed below:

  • 00 to 19 – Monday
  • 20 to 39 – Tuesday
  • 40 to 59 – Wednesday
  • 60 to 79 – Thursday
  • 80 to 99 – Friday

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