Women 'missing out' on pensions
The Pensions Advisory Service says people who earn less than £95 per job - no matter how many positions they hold - do not get pension credits.
It says such staff are often women who could boost future entitlements by making small changes to their jobs.
The government says reforms will make pensions fairer and more generous for women from 2010.
Until then part-time workers can make voluntary contributions to build up credits, it adds.
Small changes?
Entitlement to the full state pension is based on the number of National Insurance contribution credits made by workers or those on certain state benefits - currently 44 years for men and 39 years for women.
Women who have at least 10 years of contributions will usually be entitled to a reduced pension.
The Pensions Advisory Service, an independent voluntary organisation grant-aided by the Department for Work and Pensions, says only a third of woman currently get a full state pension.
It says many women work in low paid part-time jobs and therefore miss out on National Insurance contributions.
Qualifying contributions
Contributions are not payable on earnings less than £110 a week but those who earn between £95 and this level are given a credit towards a pension by the government.
Malcolm McLean, chief executive of the Pensions Advisory Service, says a small pay rise could be worth thousands of pounds in a future larger state pension.
"There could be thousands of women earning less than £95 a week either in single of multiple employments who are unaware that by increasing their hours or work slightly and increasing their pay up to the lower earnings limit neither they nor the employer will be required to pay National Insurance contributions but they will be treated as having paid them."
From 2010, both men and women will need to have paid contributions for 30 years to claim a full state pension.
BBC Website news
Replicated
Dated 13 October 2009 – valid for 6 months. AisaProfessional is a trading style of Aisa Direct Ltd, authorised and regulated by
the FSA as Independent Financial Advisers. 1 Fordbrook Business Centre, Pewsey,
SN9 5NU
Notes …
Please note that the opinions expressed in this information must not be
construed as statements of fact – you should carry out your own further research
before coming to a decision and before taking any action.
The views in this letter represent the opinions of Aisa and should
not be construed as a statement of fact. Further advice should be sought before
actioning any investment or tax advice. The Financial Services Authority does
not regulate opinions on the economic outlook, nor does it regulate some forms
of tax advice or comment such as this.
* This
newsletter has been prepared with all possible care to ensure its accuracy. It
is based on our current understanding of legislation and HMRC practice.
* Neither Aisa Direct
Ltd nor any of its employees can accept responsibility for any errors or
omissions. You should seek further professional advice prior to action.
This should not be deemed
as individual advice and you should seek further information particular to your
individual circumstances. For further information, contact
AisaProfessional on (0845) 838 7279. |
