Older state pensioners can now get up to £26.34 per day paid out to them by the DWP in their basic rate state pension payments – not including additions like Pension Credit or Additional Pension schemes. Older pensioners who retired and became eligible for a state pension before April 2016 have been handed a 4.8% boost to their weekly state pension payments, lifting them via the Triple Lock to £184.90 from the previous £176.45.
It means the pension payments are worth £9,614.80 per year, which averages out to £26.34 per day to live on, assuming a maximum National Insurance record (usually about 30-35 years), paid at the new rate from April 6 onwards. At the same time, new state pensioners will see their maximum weekly payments rise from the current £230.25 to £241.30 per week.
Those with incomplete records will see lower total take-home for their pension payments, depending on how far off the full record they are, which the DWP calculates on a case-by-case basis when you first hit state pension age.
Although the older, basic state pension is still a few thousand pounds lower than the basic rate for new, post-2016 state pensioners, there is also another DWP rule which will allow older state pensioners to boost their weekly payments, depending on their income and savings.
Pension Credit is a benefit which older state pensioners (and new state pensioners) can use to boost their income. For example, an older state pensioner who only qualifies for the basic state pension will get £184.90 per week. But Pension Credit tops up this amount up to £238 per week, which is only a few pounds less than the new state pension anyway (£241.30). However, your other income, such as work earnings, property income, savings interest or a private pension, is counted first, and you won’t be able to get the full amount if you have exceeded income limits.
Older state pensioners can also continue to get access to Additional Pension (AP) schemes, such as SERPS, and Second State Pension, which could mean that their total state pension payments would be higher than the base amounts mentioned here. Though the schemes are now no longer open to join, those who were enrolled in existing AP schemes through their employer before retirement are still being paid AP amounts each week on top of their basic pension payments.
The Chancellor has also announced that in future, state pensioners who exceed the £12,570 Personal Tax Allowance will not owe tax on their state pension, as long as they have no other income. Details of exactly how this will work are yet to be revealed, although Additional State Pension schemes for older state pensioners will not be exempted from tax, HM Treasury has confirmed to the Express.
