National Insurance and the UK state pension for migrants
In this section, we explain various issues that migrants might come across in relation to the UK state pension. If you think you are eligible for a state pension from another country (not the UK), you will have to contact the pension authority in the relevant country.
What is the UK state pension?
If you reach state pension age on or after 6 April 2016, there is a ‘new’ state pension in the UK. You can find out more about the new state pension on the GOV.UK website. You need 35 qualifying years' of National Insurance contributions (NIC) to get the full amount (however you should be able to get a pro-rata amount provided you have at least 10 qualifying years).
If you have less than 10 years UK NIC, you may be able to use your overseas social security contributions to make up the 10 qualifying years needed to get any new state pension. This is most likely if you have lived or worked in the European Economic Area (EEA), Switzerland or certain countries that have a social security agreement with the UK.
For more information and an example of how this works, see GOV.UK.
Can I claim a UK state pension?
You can only claim a UK state pension if you have paid or been credited with UK National Insurance contributions (NIC) – these are the UK’s social security contributions. If you are eligible for the UK state pension, you cannot normally get it until you reach state pension age.
You can work out when you will reach state pension age by using the calculator on the GOV.UK website.
There is more information on the UK state pension, which will help you work out whether or not you are eligible for it, on our page ‘do I have to join a pension scheme?’.
If you are eligible for a UK state pension, you should look at the sub-section below ‘how do I claim a UK state pension?’.
Can I claim a UK state pension if I retire outside the UK?
Yes – if you are eligible for the UK state pension, then it can be paid to you in a country outside the UK. You can find out more information in our sub-section below ‘how do I claim a UK state pension?’.
If you are outside the UK when you reach the age at which you can start to claim the UK state pension, then you may have to apply for your UK state pension to the pension authority in the country you are living in at the time, rather than to the UK pension authorities.
This will depend on whether you have worked in the country you have retired to. It is quite complicated and we talk about this further in the sub-section below ‘how do I claim a UK state pension?’.
How does the UK state pension work if I have made social security contributions in another country, as well as the UK?
If you have made social security contributions in more than one country, this may help you qualify for a UK state pension, or a better one. It may also affect how your UK state pension is worked out and paid.
The rules differ depending on whether you have made contributions in another EEA country, a country with which the UK has a social security contributions agreement, or a country that does not fall into either of these categories.
The UK state pension and EEA countries
You can find out which countries are in the EEA by looking at our page ‘EU and EEA countries’.
If you have paid social security contributions in another EEA country as well as the UK, then the UK will look at the contributions you have made under its own scheme to work out how much state pension to pay you. In addition, the UK will look at any contributions you have made in other EEA countries, which may help you qualify for a UK state pension or a higher state pension.
There are two methods that the UK can use to work out how much to pay you – Method A and Method B. We demonstrate how this works in the example Charlotte.
The state pension and countries with which the UK has a social security contributions agreement
Similar arrangements as above usually exist with countries with which the UK has a social security contributions agreement.
If you have paid social security contributions in a country that is not within the EEA, you should check whether the country has a social security contributions agreement with the UK. You can check by looking at the information on the GOV.UK website.
The state pension and countries without a social security contributions agreement
If you have paid social security contributions in a country that is not within the EEA and that does not have a social security contributions agreement with the UK, you should contact the International Pension Centre for more information.
You can find the contact details on the GOV.UK website.
If you are eligible for the UK state pension, you do not get it automatically when you reach state pension age – you have to claim it.
You should receive a letter four months before you reach state pension age, telling you what to do. If you have not received the letter three months before you reach state pension age, you should do the following depending on where you live:
Claiming from inside England, Scotland or Wales
- Telephone the state pension claim line. You can find the contact details on the GOV.UK website.
Claiming from inside Northern Ireland
- Telephone the Northern Ireland Pension Centre. You can find the details on the nidirect website.
Claiming from outside the UK – EEA countries
You can find out which countries are in the EEA by looking at our page ‘EU and EEA countries’.
- If you have worked in the country you are now living in, you should make your claim for your UK state pension through the pension institution in that country, that is the country you are living in. You should contact that institution for details of what you need to do, if you have not already done so.
- If you have not worked in the country you are living in then you should claim your UK state pension direct from the International Pension Centre, unless you have worked in another EEA country since leaving the UK, in which case you should make your claim through the last institution you were insured with.
If you start a UK state pension claim in the EEA country you live in, that country will pass details of your claim to the UK and any other countries where you have been insured.
You can find the contact details for the International Pension Centre on the GOV.UK website.
Claiming from outside the UK – non-EEA countries
- Contact the International Pension Centre. You can find the details on the GOV.UK website.
Do I have to pay UK tax on my UK state pension?
The state pension is taxable income in the UK. Whether or not you have to pay UK tax on your state pension depends on how much taxable income you have and whether you are UK resident or not UK resident for tax purposes. The state pension is paid gross (without deduction of tax).
If you are UK resident or tax purposes when you receive it, you will pay tax on any taxable income (including your state pension) that exceeds your personal allowance.
If you are not resident in the UK for tax purposes and the country you live in has a double taxation agreement with the UK, you may not have to pay UK tax on your UK state pension. You may, however, have to pay tax on your UK state pension in the country you live in.
Another option is that you may have to pay both UK tax on your UK state pension and tax in the country you live in, however you may be able to claim foreign tax credit relief if you pay tax in more than one country on the same income.
You can find more information on our page ‘what is a double taxation agreement?’.
State pensions from other countries
Each country has their own rules on when you can start to receive a state pension and how many qualifying years of social security contributions you need in order to be eligible. If you want to ask about your own pension rights in another country, you must ask the authorities who run the pension scheme in that country.
When you claim your UK state pension, you should normally tell the pension authority about any periods when you have made social security contributions in another country.
Just as the UK takes into consideration social security contributions made in other countries, other countries may take into consideration the contributions you have made in the UK. This may mean you find yourself in a situation like Charlotte’s in the example below, where you get a state pension paid to you by different countries.
You should be aware that if you receive a foreign state pension while you are living in the UK, this may be taxable in the UK. It may also be taxable in the country that is paying it, leading to double taxation.
You can find more information about the taxation of foreign income in the UK and double taxation on our page ‘what is a double taxation agreement?’.
Charlotte paid social security contributions in her home country of France for several years. She moved to the UK and worked there, paying NIC until she retired. Charlotte paid 30% of her total contributions into the French scheme and 70% into the UK scheme.
When she retired, Charlotte stayed in the UK and claimed state pension through The Pension Service – the UK pension authority. The Pension Service passed the details of Charlotte’s claim to the pension authority in France, who told the UK Pension Service about Charlotte’s French contributions.
The pension authority in the UK looked at Charlotte’s contributions record under its own scheme (Method A):
- The UK authority worked out that Charlotte is entitled to £75 per week based on her UK NIC alone.
The UK then carried out a comparison calculation (Method B). Under this method, the UK pension authority aggregated Charlotte’s total EEA social security contributions records and worked out what Charlotte would receive as her state pension if she had paid all of her social security contributions into its scheme only. If Method B results in a higher state pension, the pension authority for that country pays the higher amount.
- The UK authority worked out that Charlotte would be entitled to a total state pension of £120 per week if she had paid all her French and UK contributions into the UK scheme only. The UK authorities will pay Charlotte 70% of £120, that is, £84, as this corresponds to the insurance periods completed in the UK.
In addition to her UK state pension of £84, the French authorities undertook a similar exercise to see what she is entitled to from the French state pension perspective. They prepared a Method A calculation and a Method B calculation and will pay her the higher of the two results based on the 30% of her time spent there.
So, Charlotte may well receive a state pension from two countries. This ensures that:
- she is not disadvantaged by having worked in more than one country; and
- none of her contributions are lost.
Where do I find more information on National Insurance and pensions in general?
If you want more detailed information on general National Insurance topics, you can visit the following sections:
- What is National Insurance?
- What National Insurance do I pay as an employee?
- What National Insurance do I pay if I am self-employed?
- What National Insurance do I pay after retirement?
If you want more information on the UK state pension, you can visit the following sections:
- Do I have to join a pension scheme?
- Approaching retirement
- What happens if I retire abroad?
- What tax do I pay on my state pension lump sum?
- What is state pension deferral?
What benefits might I be entitled to other than the state pension?
There are lots of state benefits in the UK that depend on you having paid a certain amount of NIC, not just the state pension. These are called ‘contributory benefits’.
Your previous periods of insurance, work or residence in other countries can therefore be taken into account when you claim other UK state benefits. By ‘other’ benefits we mean things like sickness, maternity and equivalent paternity benefits, invalidity benefits, survivors’ benefits and death grants, unemployment benefits, family benefits and so on.
It is difficult to say with any certainty whether a particular benefit will be covered by rules similar to those for the state pension, as it depends on the agreement between the UK and the other country or countries involved. You should note that not all countries have agreements with the UK allowing such benefits to be claimed.
- You can find some general information about the rules for EU countries on the European Commission website.
- You can find some general information about the rules for particular benefits for both EEA and other countries on the GOV.UK website.
- However, you will probably need to contract the authorities for information on your particular case. You can find contact details on the European Commission website.