Little-known state pension loophole which can boost your retirement payments by £667 a year – how to benefit
Thousands of retirees nearing the state pension age could boost their retirement benefits by £667 annually, thanks to a little-known loophole.
Currently, the full new state pension amounts to £221.20 per week, totalling £11,502.40 per annum.
This full amount is available to those over the age of 66 who have accumulated at least 35 years of National Insurance (NI) contributions.
If you have fewer years of contributions, your pension will be reduced, and if you haven't paid NI for at least 10 years, you won't receive any state pension.
For most pensioners, it forms only part of their retirement income, as they could have other pots from a workplace pension, earning and savings.
For most pensioners, the state pension constitutes only a portion of their retirement income, as they may also have funds from workplace pensions, earnings, and savings.
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However, the state pension is not automatically paid upon reaching the age of 66.
Instead, you must claim it, but this is not compulsory.
Therefore, if you are still working or do not need the money immediately, opting to delay claiming your state pension can significantly increase your future income.
For every nine weeks you postpone claiming your pension, you will receive an additional 1%.
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In practical terms, delaying your state pension by one year will increase your future payments by 5.8%, potentially adding up to an extra £667 annually.
Meanwhile, delaying for five years will add a whopping £3,333.20 to the annual sum you receive.
Of course, these figures are based on the current state pension amounts, but as this increases each year thanks to the triple-lock, the actual amounts you add are likely to be higher.
How much could you get?
| Weekly income | Annual income | |
| Full state pension | £221.20 | £11,502.40 |
| Delay by one year | £234.02 | £12,169.04 |
| Delay by two years | £246.84 | £12,835.68 |
| Delay by three years | £259.66 | £13,502.32 |
| Delay by four years | £272.48 | £14,168.96 |
| Delay by five years | £285.30 | £14,835.60 |
How to delay your state pension
You don't need to do anything to delay your state pension, you simply don't claim it.
The money will then be deferred until you apply to receive it.
When you want the money, you can make and the extra money will be added to your weekly payment.
Who is eligible to delay their state pension?
Most people can defer their state pension to get a bigger payout, but there are some exceptions.
Time spent in prison or when you or your partner get certain benefits does not count towards the nine-week deferrals.
You cannot build up extra State Pension during any period you get:
- Income support
- Pension credit
- Employment and support allowance (income-related)
- Jobseeker's allowance (income-based)
- Universal Credit
- Carer's allowance
- Carer support payment
- Incapacity benefit
- Severe disablement allowance
- Widow's pension
- Widowed parent's allowance
- Unemployability supplement
You cannot build up extra State Pension during any period your partner gets:
- Income support
- Pension credit
- Universal Credit
- Employment and support allowance (income-related)
- Jobseeker's allowance (income-related)
What if I reached 66 before April 6, 2016
The rules are slightly different if you reached the state pension age before April 6, 2016.
Instead of getting a 1% increase for every nine weeks you delay, you get 1% for every five weeks that you don’t claim.
You can also choose to take the money in higher weekly payments or as a one-off lump sum.
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When you claim your deferred State Pension, you'll get a letter asking how you want to take your extra pension.
You'll have three months from receiving that letter to decide what you want to do.
How does the state pension work?
AT the moment the current state pension is paid to both men and women from age 66 - but it's due to rise to 67 by 2028 and 68 by 2046.
The state pension is a recurring payment from the government most Brits start getting when they reach State Pension age.
But not everyone gets the same amount, and you are awarded depending on your National Insurance record.
For most pensioners, it forms only part of their retirement income, as they could have other pots from a workplace pension, earning and savings.
The new state pension is based on people's National Insurance records.
Workers must have 35 qualifying years of National Insurance to get the maximum amount of the new state pension.
You earn National Insurance qualifying years through work, or by getting credits, for instance when you are looking after children and claiming child benefit.
If you have gaps, you can top up your record by paying in voluntary National Insurance contributions.
To get the old, full basic state pension, you will need 30 years of contributions or credits.
You will need at least 10 years on your NI record to get any state pension.