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TOPIC: ESA AND PRIVATE PENSION

ESA AND PRIVATE PENSION 3 years 2 months ago #123450

Hi all,

I am claiming contribution based ESA in the support group, DLA high mobility and high care. I have just received a letter from my private pension to tell me that my pension will be paid this year which works out to around £50.00 per week. My pension age was 60 when I first joined this work pension 32 years ago, and I haven't contributed to it since 1985, but now my pension age is not until 65.

My question is, If I choose to defer my pension on a yearly basis would the Dwp stop my ESA. I am not really sure how I would stand by refusing my pension. Any information you could give me would be a big help. I could also claim my pension on the grounds of ill health, so not really sure of what to do.

thanks
shandy

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Last Edit: by Gordon.

ESA AND PRIVATE PENSION 3 years 2 months ago #123451

Shandy

Any deferred pension will likely be classed as Notional Income, in other words you will be classed as receiving it even though you are not, however, there is an £85/week disregard for pension income for claimants receiving ESA(CB) so your ESA should not be effected.

You still need to inform the DWP of this Change of Circumstances and they will undoubtedly require additional documentation about what is happening.

Gordon

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Nothing on this board constitutes legal advice - always consult a professional about specific problems

ESA AND PRIVATE PENSION 3 years 2 months ago #123453

Hi S,

Just to add to Gordon's sound advice, in that you will probably be deemed to be in receipt of your Occupational Pension (OP) even if you choose not to take it.

As it seems that you are in The SG and in receipt of High Rate Care of DLA, if you also in receipt of IR : ESA Premium Top-ups in addition to your CB ESA payments, the OP payments will be classed as household income £ for £, for the purposes of the IR ESA means test.

With regards to IR ESA premiums here is a : Recent post on this isuue.

If you are in receipt of CB ESA only, as Gordon says there is an £85/Week disregard for any OP payments.

e.g. OP = £105/Week which is £20/Week in excess of the £85/Week disregard, therefore 50% of the excess (£10/Week) would be deducted from your weekly payments of CB ESA.

Any OP less than £85/Week will have no effect of your CB ESA payments.

As already pointed out, you need to inform the DWP of this in writing, paying heed to the comments made in : This Post regarding reporting a C of C.

bro58
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Last Edit: by bro58.

ESA AND PRIVATE PENSION 3 years 2 months ago #124140

Thanks for the great advise, I have now received a letter from my occupational pension and I cannot defer the pension, I only have 2 options:-

1. To receive a full annuity of £3527.63 per year paid monthly

2. To receive a tax free cash sum of £5233.58 and a reduced annuity of £3185.05 which will not increase and is in respect of a guaranteed minimum pension

I am totally confused which way to go on this as I don't want my esa and dla messed about.

None of the above payments come to the £85.00 per week which is allowed. I would be grateful for any advice right now.

thanks
Shandy

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Last Edit: by bro58.

ESA AND PRIVATE PENSION 3 years 2 months ago #124142

shandy wrote: Thanks for the great advise, I have now received a letter from my occupational pension and I cannot defer the pension, I only have 2 options:-

1. To receive a full annuity of £3527.63 per year paid monthly

2. To receive a tax free cash sum of £5233.58 and a reduced annuity of £3185.05 which will not increase and is in respect of a guaranteed minimum pension

I am totally confused which way to go on this as I don't want my esa and dla messed about.

None of the above payments come to the £85.00 per week which is allowed. I would be grateful for any advice right now.

thanks
Shandy


Hi S,

Whatever option you choose, it will have no effect whatsoever on your DLA payments.

Or indeed PIP, if/when you are transferred over to that.

With respect to ESA :

"1. To receive a full annuity of £3527.63 per year paid monthly"


If you are, and remain in receipt of CB ESA only, (whichever group (WRAG or SG) you may be in) as the figure that you have quoted is below £85/Week it would have no effect at all on your CB ESA payments.

Although, you would still have to inform the DWP in writing providing copies of the relevant documentation.

"2. To receive a tax free cash sum of £5233.58 and a reduced annuity of £3185.05 which will not increase and is in respect of a guaranteed minimum pension"


Again, with respect to CB ESA only, The tax free lump sum that you mention, would not have any effect on your CB ESA payments. As CB ESA is non means-tested, it would not matter how much you received as a "lump sum".

As with Option 1, as the Weekly OP amount does not exceed £85/Week it also would not affect your CB ESA payments.

As previously advised you would have to inform The DWP of the OP payments and any lump sum.

With respect to current entitlement to any IR ESA and any potential future entitlement, any weekly OP that you receive would be counted £ for £ in the IR ESA means test, and may therefore preclude you from payment of IR ESA.

With regards to the lump sum and any IR ESA, the £5233.58 would be classed as capital for the purposes of the IR ESA means test.

However, you are allowed £6,000 in total capital assets and saving without it affecting IR ESA payments.

Between £6,000 and £16,000, £1/Week would be deducted for every £250 in excess of the £6000.

e.g. £8, 500 in capital, assets and savings = £2,500 excess. £2,500/£250 = 10. So you would have £10/Week deducted from any IR ESA payments.

Capital, assets and savings in excess of £16,000 would preclude you from any IR ESA payments.

So to recap, neither of the options that you have quoted would affect payments of CB ESA only.

bro58
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Last Edit: by bro58.

ESA AND PRIVATE PENSION 3 years 2 months ago #124144

Thank you Bro58, you are a mind of information. You have put my mind at rest to a certain extent. All I have to do now is decide which option to take, thank you very much.

Shandy

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