As Pension Awareness Week draws to a close it’s only fitting that we look at a subject not often spoken about to help raise awareness on what happens to State Pension when someone dies.
The monthly payment is a lifeline for many older people and you’ll usually need at least 10 qualifying years on your National Insurance record to get any State Pension.
You will be on the ‘basic’ State Pension of £134.25 if you’re:
If you were born later, you’ll claim the ‘new’ State Pension - if you have 35 years on your National Insurance record, you’ll receive the full £175.20 a week.
You’ll get a proportion of the new State Pension if you have between 10 and 35 qualifying years.
People who are eligible to claim the State Pension can do so once they’ve reached their State Pension age - which is rising.
From October 2020, anyone born between October 6, 1954 and April 5,1960 will reach State Pension age on their 66th birthday.
Once someone reaches State Pension age they can defer payments if they choose to carry on working.
Doing this will actually increase the payments when they eventually decide to claim. On top of this, there is nothing stopping people claiming State Pension while continuing to work.
But what happens to your State Pension if you die? And what do you do about your other half's pension if they die?
What happens to your State Pension when you die?
A State Pension won't just end when someone dies, you need to do something about it.
When the person dies, you must inform the Pension Service so that payments stop - You can ring the Pension Service helpline on 0800 731 0469.
You may be entitled to extra payments from your deceased spouse's or civil partner's State Pension.
However, this depends on their National Insurance contributions, and the date they reached the State Pension age.
If you haven't reached State Pension age, you might also be eligible for Bereavement benefits.
Inheritance: Basic State Pension
Should a spouse or civil partner have reached State Pension age before April 6, 2016, then gov.uk instructs them to contact the Pension Service once someone dies in order to check what they can claim, reports Express.co.uk.
It may be that they can increase their basic State Pension by using the deceased’s qualifying years if they do not already get the full amount.
Should they have reached State Pension age on or after April 6, 2016, or be under State Pension age when their spouse or civil partner dies, the “Your partner’s National Insurance record and your State Pension” tool on the UK Government website can enable a person to check what inheritance they may be entitled to.
For people who are single or divorced, or who have had their civil partnership dissolved, it may be that their estate can claim some of a basic State Pension.
This is if that person dies after reaching State Pension age, and only if the State Pension had not been claimed. In this circumstance, the estate can claim up to three months of the basic State Pension.
Extra money from deferring State Pension
Some people may opt to defer their State Pension in order to build up an extra amount.
In this situation, the spouse or civil partner may either claim the extra State Pension or get a lump sum.
State Pension top up
Should anyone have topped up their State Pension (between October 12, 2015 and April 5, 2017), the spouse or civil partner may be able to inherit some or all of the top up, gov.uk states.
Inheritance: New State Pension
It may be that a person is able to inherit an extra payment on top of their new State Pension if they are widowed.
However, an individual cannot inherit anything should they remarry or form a new civil partnership before they reach State Pension age.
Inheriting Additional State Pension
If a marriage or civil partnership began before April 6, 2016 and one of the following circumstances applies, then a person may inherit part of their deceased partner’s Additional State Pension. These are:
Inheriting a protected payment
A person will inherit half of their partner’s protected payment if their marriage or civil partnership with them began before April 6, 2016, and:
Inheriting extra State Pension or a lump sum
A person may inherit part of all of their partner’s extra State Pension or lump sum if:
Check your State Pension to calculate how much money you’ll get on the gov.uk website here.