How it works
You do not get your State Pension automatically – you have to claim it. You should get a letter no later than 2 months before you reach State Pension age, telling you what to do.
You can either claim your State Pension or delay (defer) claiming it.
If you want to defer, you do not have to do anything. Your pension will automatically be deferred until you claim it.
Deferring your State Pension could increase the payments you get when you decide to claim it. Any extra payments you get from deferring could be taxed.
This guide is also available in Welsh (Cymraeg).
If you’re on benefits
You cannot get extra State Pension if you get certain benefits. Deferring can also affect how much you can get in benefits.
You must tell the Pension Service if you’re on benefits and you want to defer.
What you’ll get
The amount of extra State Pension you could get depends on when you reach State Pension age.
If you reach State Pension age on or after 6 April 2016
Your State Pension will increase every week you defer, as long as you defer for at least 9 weeks.
Your State Pension increases by the equivalent of 1% for every 9 weeks you defer. This works out as just under 5.8% for every 52 weeks.
The extra amount is paid with your regular State Pension payment.
Example
You get £185.15 a week (the full new State Pension).
By deferring for 52 weeks, you’ll get an extra £10.70 a week (just under 5.8% of £185.15).
This example assumes there is no annual increase in the State Pension. If there is an annual increase, the amount you could get could be larger.
If you reached State Pension age before 6 April 2016
You can usually take your extra State Pension as either:
- higher weekly payments
- a one-off lump sum
When you claim your deferred State Pension, you’ll get a letter asking how you want to take your extra pension. You’ll have 3 months from receiving that letter to decide.
Higher weekly payments
Your State Pension will increase every week you defer, as long as you defer for at least 5 weeks.
Your State Pension increases by the equivalent of 1% for every 5 weeks you defer. This works out as 10.4% for every 52 weeks.
The extra amount is paid with your regular State Pension payment.
Example
You get £141.85 a week (the full basic State Pension).
By deferring for 52 weeks, you’ll get an extra £14.75 a week (10.4% of £141.85).
This example assumes there is no annual increase in the State Pension. If there is an annual increase, the amount you could get could be larger.
Lump sum payment
You can get a one-off lump sum payment if you defer claiming your State Pension for at least 12 months in a row. This will include interest of 2% above the Bank of England base rate.
You’ll be taxed at your current rate on your lump sum payment. For example, if you’re a basic rate taxpayer your lump sum will be taxed at 20%.
If you’re in prison
You will not build up extra State Pension until you leave prison.
Annual increases
After you claim your State Pension, the extra amount you get because you deferred will usually increase each year based on the Consumer Price Index. It will not increase for some people who live abroad.
