An introduction to UK pension systems—the state pension, state second pension and single-tier state pension
Produced in partnership with John Hayward, Pensions author
An introduction to UK pension systems—the state pension, state second pension and single-tier state pension

The following Private Client guidance note Produced in partnership with John Hayward, Pensions author provides comprehensive and up to date legal information covering:

  • An introduction to UK pension systems—the state pension, state second pension and single-tier state pension
  • Brexit impact
  • State pensions
  • State second pension

Brexit impact

The UK has voted to leave the EU and is due to leave on exit day, as defined in section 20 of the European Union (Withdrawal) Act 2018.

EU rules facilitate the co-ordination of social security entitlements for individuals moving within the EU and EEA. These arrangements need to be considered as part of exit negotiations. For instance, one area affected is the uprating of the UK state pension. While the UK state pension is payable overseas, it is currently only uprated if the pensioner is in an EEA country or one with which the UK has a reciprocal agreement requiring uprating.House of Commons briefing paper: Brexit and the state pensionRegulation 883/2004 of 29 April 2004 on the coordination of social security systemsRegulation 987/2009 of 16 September 2009 laying down the procedure for implementing Regulation 883/2004

The government has stated that it has reached agreement with the EU to maintain State Pension up-rating for those intended to be covered by a withdrawal agreement, subject to reciprocity. In the event of a no-deal, the government has also committed to uprate across the EU in 2019 to 2020, but any uprating occurring beyond that will be subject to reciprocal arrangements being put in place.State Retirement Pensions: British Nationals Abroad: Written question—183890 (2 November 2018)White Paper on Brexit (July 2018), para 89DWP: UK nationals in the EU: benefits and pensions in a ‘no deal’ scenario

State pensions

A state retirement pension is provided dependent upon a person’s National Insurance (NI) contribution record and is comprised of three components. These are:Social Security Act 1973

  1. the basic old age pension

  2. the state