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What is State Pension deferral?

You don’t have to stop working or claim your State Pension when you reach State Pension age. You can put off claiming your State Pension when you reach State Pension age. You can also choose to stop claiming it after having claimed it for a period.

The age at which you retire from employment does not affect when you can start getting your State Pension after you reach State Pension age.

Changes to State Pension age

The State Pension age is increasing. To find out more see ‘Calculating your State Pension age’.

• Calculating your State Pension age

More choice when deferring your State Pension

Now that people are living longer and healthier lives, it makes sense to make it easier to work flexibly after State Pension age.

Since 6 April 2005, if you put off claiming your State Pension, you can choose one of the following options when you do claim.

Extra State Pension

If you put off claiming your State Pension for at least five weeks you can earn an increase to your State Pension. The increase will be one per cent for every five weeks you put off claiming.

Once you claim your State Pension, any extra State Pension you have built up will usually increase each year.

• Extra State Pension

Claiming a lump sum payment

If you delay claiming your State Pension for at least 12 consecutive months, you may choose to receive a one-off lump sum payment. Your State Pension will also be paid at the normal rate. To be eligible for this, your delay in claiming must all have fallen after 5 April 2005.

• Claiming a lump sum payment

You will not build up any extra State Pension or lump sum if you or your partner receive certain social security benefits while you put off claiming your State Pension.

What if you reached State Pension age before April 2005?

If you haven't claimed your State Pension, when you finally do claim it, you'll get an increase for the period up to 6 April 2005. This is based on the old rate of extra State Pension (about 7.5 per cent for a whole year). This is provided the period is five years or less. For the period falling after that date there is no maximum time limit. You'll be eligible for either:

• an increase based on the new extra State Pension rate (about 10.4 per cent for a whole year)
• a lump sum payment (if you continue to put off claiming for a further 12 months)

Choosing State Pension deferral – what to do

Four months before you reach State Pension age The Pension Service will write to you.

If you have not yet claimed your State Pension but you want to put off getting it, you do not need to do anything. But you will need to tell The Pension Service what you want to do if you are already claiming another social security benefit.

If you are already getting your State Pension, but would like to stop claiming it, you should contact your pension centre. The telephone number will be on any letters you have received from your pension centre.

• Contact The Pension Service

Living abroad

If you live abroad and haven't claimed your State Pension, when you reach State Pension age you may be able to put off claiming it.

If you live outside the UK and have already claimed your State Pension you will not normally be able to stop claiming it.

To stop claiming your State Pension you must live in the UK or in one of the following countries:

Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Gibraltar, Greece, Hungary, Iceland, Ireland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, The Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, Switzerland.

You must also be one of the following:

• a UK national
• a national of one of the above listed countries
• entitled to live in one of the above listed countries

Tell The Pension Service about a change in your circumstances

Find out what you need to report, such as a change of address or bank details.

• Report your change of address, bank details or other circumstances to The Pension Service

More useful links

• Taxes when you take your State Pension later

• Working past State Pension age - your options