Hi, my name is Jontowey! Partner is looking to to retire early and do a takedown on her pension

Jontowey

My partner is my carer and we claim UC carers allowance and I get pip both rates she is looking to to retire early and do a takedown on her pension something similar to what she receives on UC how do we go about this and she will receive her state pension next year

L_Volunteer

Hi @Jontowey

Welcome to Scope's forum. It is great to see you have joined us. How are you today? Unfortunately, this is not an area of my expertise. This means I can only hope someone with more knowledge in this area is able to respond to you soon. In the meantime, I just wanted to respond to greet you and let you know that we hear and see you 

calcotti

If she draws regular pension income it will be deducted in full from the UC payments so there will be no financial gain. All she will be doing is using up some of her pension pot with no benefit to yourselves.

When she gets her State Pension that will be deducted in full from your UC. Once she reaches pension age she will be expected to make use of her pension pot too.

When you say you claim UC Carer's Allowance do you mean you are claiming UC with the carer element or is she claiming Carer's Allowance too?

If she is able to take a lump sum from her pension she can do this and if your total capital remains below £6,000 it will not affect the UC. More than £6,000 and UC will be reduced by £4.35/month for every £250, or part thereof, over £6,000. Over £16,000 and entitlement to UC ends.

poppy123456

When claiming UC any pension that's paid weekly/monthly will reduce your UC £1 for £1 so it's not financially worth taking any income from the pension.

If she takes a lump sum this will be classed as savings which means if this increases your total savings to more than £16,000 on the last day of your assessment period then your UC will end. For every £250 or part there of over £6,000 there's a £4.35 per month deduction in your UC.

Jontowey

Further to my post my partner also works 12hrs a weekx

SueHeath

I don't know any thing about UC or many other benefits.
@poppy123456 @calcotti
So if @Jontowey partner stops working - 12hours a week approx £400 a month and they are on the money that was said - had a drawn down on pension can she not have the same amount from her pension as she is in wages, with out making any difference, hope that makes sense.

poppy123456

SueHeath said:

I don't know any thing about UC or many other benefits.
@poppy123456 @calcotti
So if @Jontowey partner stops working - 12hours a week approx £400 a month and they are on the money that was said - had a drawn down on pension can she not have the same amount from her pension as she is in wages, with out making any difference, hope that makes sense.

No because that’s not how it works. A weekly/monthly pension income is not earnings. It will reduce the UC £1 for £1 as previously advised.
@Jontowey have you reported your health condition and had a work capability assessment for UC? 

SueHeath

poppy123456 said:

SueHeath said:

I don't know any thing about UC or many other benefits.
@poppy123456 @calcotti
So if @Jontowey partner stops working - 12hours a week approx £400 a month and they are on the money that was said - had a drawn down on pension can she not have the same amount from her pension as she is in wages, with out making any difference, hope that makes sense.

No because that’s not how it works. A weekly/monthly pension income is not earnings. It will reduce the UC £1 for £1 as previously advised.
@Jontowey have you reported your health condition and had a work capability assessment for UC? 

Bare with me poppy so does that mean the pension would be classed as savings 

poppy123456

A lump sum will be classed as savings. 

As advised here..

poppy123456 said:

When claiming UC any pension that's paid weekly/monthly will reduce your UC £1 for £1 so it's not financially worth taking any income from the pension.

If she takes a lump sum this will be classed as savings which means if this increases your total savings to more than £16,000 on the last day of your assessment period then your UC will end. For every £250 or part there of over £6,000 there's a £4.35 per month deduction in your UC.

SueHeath

poppy123456 said:

A lump sum will be classed as savings. 

As advised here..

poppy123456 said:

When claiming UC any pension that's paid weekly/monthly will reduce your UC £1 for £1 so it's not financially worth taking any income from the pension.

If she takes a lump sum this will be classed as savings which means if this increases your total savings to more than £16,000 on the last day of your assessment period then your UC will end. For every £250 or part there of over £6,000 there's a £4.35 per month deduction in your UC.

So if she packed up work and didn't draw down on her pension would they get more UC 

poppy123456

There’s a maximum amount of UC they will be entitled to for their circumstances. Whether they will have more UC will depend on whether they currently have the work allowance, which means part of any earnings received would be ignored before any deductions apply. 

If Jontowey has been assessed as having either LCW or LCWRA then the work allowance will apply. Otherwise it won’t. If all of the earnings are ignored because of the work allowance then no, their UC won’t increase.
See link https://www.gov.uk/government/publications/universal-credit-work-allowances/universal-credit-work-allowances

SueHeath

wow i can understand how people can think that this is a mine field - it's totally over my head ha ha - thanks for that @poppy123456 hope i didn't butt in @Jontowey and good look with all.

poppy123456

Yes, complicated is an understatement.

calcotti

SueHeath said:

I don't know any thing about UC or many other benefits.
@poppy123456 @calcotti
So if @Jontowey partner stops working - 12hours a week approx £400 a month and they are on the money that was said - had a drawn down on pension can she not have the same amount from her pension as she is in wages, with out making any difference, hope that makes sense.

Just reiterating what poppy has said.
Wages and pension income are treated differently.
Every pound of pension income reduces the UC payable by one pound.
For earnings, if the LCWRA element is included or there are children on the claim, some of the earnings are ignored completely. For any earnings in excess of the amount ignored the UC is reduced by 55p for every pound.

calcotti

Might be helpful to give an example.

Jack and Jill live in a house they own so pay no rent. Jack receives PIP. They also claim UC. Jack gets the LCWRA element and Jill gets the carer element for looking after Jack. Their UC is the standard allowance plus the LCWRA element plus the carer element making a maximum amount of £1,017.27/month.

Jill works and earns £460/month. Because of the LCWRA element a Work Allowance is applied to the UC claim, because there are no housing costs the Work Allowance is £557/month. As Jill’s earnings are less than £557 the earnings are completely ignored when calculating the UC payable. Each month they receive their full UC of £1,017.27 plus Jill’s earnings of £460 making a total of £1,477.27/month.

Jill stops work. Their monthly income is now just UC of £1,017.27.

Jill starts to receive a pension of £460/month. This is deducted in full from the UC so each month they receive the pension plus UC of £557.27. Their monthly income remains £1,017.27

I’ve ignored PIP because that is unchanged throughout.

OP, can you confirm that you are younger than your wife.