Centrelink can help claim your overseas pension

June has been told she has to apply for an overseas pension.

purse full of euros

June has been told she has to apply for an overseas pension but doesn’t know where to start or what effect any payment would have on her Age Pension claim.

Q. June

I am approaching Age Pension age and a friend has told me that, as I was born in the UK, and have lived and worked there, I have to claim a pension from the UK Government before I can claim an Australian one. Is this the case?  I have no idea how to go about doing so.

My friend also told me that my Australian Age Pension would be reduced by the amount I receive from the UK. But with ever-changing exchange rates, how am I supposed to keep Centrelink advised of how much my pension will be?

A. Your friend’s advice is correct. If you are, or may be, entitled to a pension from another country, then you must claim that before you can make a claim for an Australian Age Pension. However, if you need to claim a pension from a country that has an international special security agreement with Australia, Centrelink’s International Service will assist you with your claim.

The UK is not a country with which Australia has an agreement but International Service can help you find the information you need to enable you to commence your claim. You can also find out more about claiming a UK state pension at Gov.uk/state-pension-if-you-retire-abroad

When you advise Centrelink of your income and assets from overseas, it will convert the value into Australian dollars. Once you have been granted a UK pension, the amount will stay the same – it is not indexed. This means that the only fluctuation in the value of your payment will be due to the exchange rate. Centrelink currently uses the Commonwealth Bank buy rates that apply on the fifth business day before the first of each month.

Centrelink will update your income details on the first of each month and apply this rate of income to your Age Pension payment.

You should contact Centrelink on 13 2300 to find out more about your personal circumstance.

RELATED ARTICLES





    COMMENTS

    To make a comment, please register or login
    Brisand
    27th Mar 2017
    10:38am
    The Australian pension is NOT reduced by the full amount of the UK Pension although it is reduced somewhat. I Think by assett and income test, check Centerstink.
    The NZ pension does reduce your Australian Pension Dollar for Dollar, But Centerlink work out the exchanges etc. and will help set it up.
    You can also buy back some years of UK pension to increase ethe amount.
    Brisand
    27th Mar 2017
    10:43am
    Always worth talking to a Centerlink FIS Officer, Generally very helpful and free.
    Note once you start a UK pension it is frozen so that the amount you get on day 1 is the same for life.
    niemakawa
    27th Mar 2017
    4:19pm
    Only frozen in a few countries of which Australia is one otherwise The UK pension is generally indexed .
    johninmelb
    27th Mar 2017
    11:25am
    I did not apply for my UK Pension until after I got the Australian Pension. As I only lived and worked in the UK for less than 12 months, I did not expect to be eligible anyway. I only enquired out of curiosity when I found my old National Insurance Card while cleaning up.

    I just emailed the pension office in the UK, and they sent me all the forms etc. All the info is online. You don't need Centrelink's help, they haven't got the time or staff to deal with this anyway. The whole process is a million times easier than for our Pension. Your UK pension will be paid straight into your Australian bank account.

    I only get a few dollars a month, and it is counted as part of my assets at the moment. As it is 2/10's of bugger all, it makes little difference. As noted, the exchange rates are calculated each month. You will get a statement from Centrelink every six months or so showing what conversion rates were used each month.

    Don't overthink this, it is dead easy.
    cookie47
    27th Mar 2017
    12:52pm
    Spot on John, it's so easy. Once I was told that I needed to apply for a British Pension (which was a surprise after 48 years in Australia and had no intention of doing it ). I received the forms in the post from Centerlink international. I didn't know my British insurance number but gave all details of address and work places and they matched me.
    RJW1950
    27th Mar 2017
    11:51am
    You DONOT have to apply for your overseas pension before you apply for Australian pension. I got my Australian pension and then got my English Pension. Their is no need to go through Centrelink to apply for your English pension. I just printed all the forms from the English website filled them all in and sent to England and my English pension started appearing in my bank account in about 4 weeks. If you don't know your old National Insurance number you need to send them your original English birth certificate with the forms. As my English pension is very minimal it does not affect my Australian pension.

    Always recommend talking to Centrelink though, I have always found it easier to call into an office rather than ringing them
    Migrant
    27th Mar 2017
    11:57am
    Dear. Brisbane,
    Readers should note that the social security arrangements between Aust and NZ, are different from Aust and UK, and result in the NZ pension being reduced to the amount payable under the Aust rules.
    Thus if you have a pension of say $5000 pa earned from 20 years in NZ , it will be reduced to Nil , if , because of the Aust income and assets test you are not entitled to an Aust Pension.
    The U.K. Pension is yours by right, the NZ pension is not.
    Migrant
    Brisand
    27th Mar 2017
    1:35pm
    I think thats what I said?
    Migrant
    27th Mar 2017
    11:59am
    Sorry Brisand, my iPad decided that you should be " corrected" to Brisbane
    Migrant
    Deenick
    27th Mar 2017
    12:23pm
    Please correct me if I'm wrong. If you are entitled to an overseas pension, say NZ, then you get both a pension from both countries. Meaning that you are better off than someone who lived in Australia all their life?
    Brisand
    27th Mar 2017
    1:38pm
    No, If you get a NZ pension then your australian pension is reduced by same amount as the pesion. Effectivlt NZ Pesion = 0.
    If you get a UK pension then it is counted as an assett, but remember it was paid for seperatly in UK by "National insuranse stamps" or equiv.
    inextratime
    27th Mar 2017
    12:38pm
    When applying to the UK you will need to advise them of the companies you worked for and the approximate dates that you worked there. They will then work out a pro rata amount that you are entitled to based on your payments made while working in the UK (Remember the old p45 form). Centrelink will then need the letter that the UK Pension office sends you advising of the amount they agree to pay. The pension will be deposited to your bank a/c every 14 days so in effect 13 payments a year if you elects a monthly deposit period.
    inextratime
    27th Mar 2017
    12:41pm
    Sorry that should have read every 28 days if you elect a monthly payment period !
    inextratime
    27th Mar 2017
    12:41pm
    Sorry that should have read every 28 days if you elect a monthly payment period !
    Deenick
    27th Mar 2017
    1:02pm
    Thank you. However does this mean that you have two pensions UK and Australia both providing you a total pension greater than that received by an Australian who has lived in Australia all their life and not worked outside of Australia
    inextratime
    27th Mar 2017
    1:43pm
    Yes
    inextratime
    27th Mar 2017
    4:29pm
    I will also add that the UK does not want to know what assets you hold, income levels etc. Once you reach 65 and you have worked in the UK at some stage and you hold a UK passport, you are awarded a pension that is relative to the amount of compulsory contributions you made while employed. I believe you have to have worked over ten years there to receive the full pension, tho I may be wrong on this.
    johninmelb
    28th Mar 2017
    11:50am
    I do not have a UK Passport, and only lived and worked in the UK for about 12 months, yet I am still entitled to a UK pension. I get about £7 a week.

    So no 10 year residency, or UK passport necessary.

    If you went to the UK for the obligatory "working holiday" as most 20 somethings did back in the 60's, then you will be entitled to something, As I still had my NI number, knew the names and addresses of the two employers I worked for, and my address while in the UK, it was easy for me to provide the necessary information for them to find me in the system.
    sunny
    27th Mar 2017
    1:15pm
    Having retired a couple of months ago, I automatically received forms from Centrelink International. I dutifully filled out everything, regardless if it said "cant remember this" Also explaining to the British Pension Office I wouldn't have bothered with this, but Centrelink advised me to., & hey presto! a good sum of money in the bank in 3 days.
    I did work in the UK, therefore they felt it was owed me. Thankyou, even if its a one off payment, thankyou.
    KSS
    27th Mar 2017
    1:29pm
    If you apply for a UK pension you will need your Nationanl Insurance number. If you have lost your NI number you should contact HM Revenue and Customs. You can either complete the online form on the HMRC website,(https://www.gov.uk/government/publications/national-insurance-get-your-national-insurance-number-in-writing-ca5403) or call the National Insurance enquiries helpline on 0300 200 3500 (lines are open 8am to 5pm, Monday to Friday).

    Once you have that number you can apply for a pension statement which will tell you how much (if anything) you would receive should you make a claim. Go to this link for information: https://www.gov.uk/check-state-pension. Once you know how much you may get you can go from there. There are options for example to make additional payments to increase the UK pension, or make lump sum installments etc etc. But it all starts from having your NI number and getting a pension statement.
    Romeital
    27th Mar 2017
    3:05pm
    Centrelink fis officers wont necessarily advise you to apply for a UK pension if one is entitled to one
    Not all fis officers know what they are talking about
    I was not told to apply for a Uk pension indeed as i only worked in the UK for 5years after leaving school it was only by chance that i found i was
    You dont have to apply for a UK pension prior to applying for the Aus one this might depend on how long you have been resident in Aus
    If you do receivea UK pension after gaining your Aus one you simply advise Centrelink and you the have the option of paying any overpayment you have received by installments or one off
    Indeed your UK pension will be probably received before any UK paperwork catches up so wont actually know what your UK pension amount actually is that happened in my case
    In any case it is worth getti g foreign pensions you are entitled to as you and the Aus government gains
    niemakawa
    27th Mar 2017
    4:24pm
    Don't worry Centrelink will soon let you know if you should claim and in most cases will send you the necessary forms to complete. However it may be better to contact The UK Pensions centre before you retire complete a form and they will let you know an estimate of any pension to which you maybe entitled. A claim for a UK pension maybe made 13 weeks before your official retirement age (not before). I think this is still the case.
    johninmelb
    28th Mar 2017
    11:54am
    How does Centrelink know if you are entitled to a UK pension?

    They did not advise me that I was entitled to one. I had to find that out myself.
    niemakawa
    28th Mar 2017
    6:46pm
    @Johninmelb. When a person makes an application for an Australian pension they must (or should) list all absences (dates to-from) from Australia be it a holiday or other reason. Of course you must also inform them of the date when you first arrived in Australia. So anyone who arrived say as 30 year old, then they will assume you pension rights from your previous Country. They will ask you to make a claim although you may or may not be entitled to a pension from your country of origin. I spent one year outside of Australia a couple of years ago, they sent me a form asking me if I ever worked or was entitled to a pension in the Country where I lived for that time.
    johninmelb
    28th Mar 2017
    7:59pm
    As far as I can recall, the forms I filled in for my Aussie pension didn't ask me about dates of times spent outside of Oz. I don't appear to have kept a copy of the forms, something I always do with Centrelink to forestall their lying and cheating.

    It would have been a bloody long list, if I put down every holiday I'd ever been on, eg. I have been to the UK 16 times in the 50 years. Only one trip was longer than about 3 weeks, and that was my working holiday back in 1967. Have also had many trips to Asia, the US, and Canada. Mind you, I can account for all this, as I have a spreadsheet on my computer. Had to provide this information many years ago when I foolishly applied for a job with ASIO!

    Seems like I got off lightly.
    niemakawa
    28th Mar 2017
    9:58pm
    @johninmelb. Have a look at the Centrelink application form.

    Q 18. Are you living in Australia permanently.

    Q 19. Have you EVER lived or travelled outside Australia including short trips and holidays.

    Year you last entered Australia

    Passport number.

    Although specific dates may not be required to be entered on the form by giving all the other information Centrelink will most certainly check with immigration to verify your answers. So I would say they are aware of your numerous sojourns.

    I remember a couple of years ago I helped a friend complete her application for a UK pension and I recall in their form it was required to specify all dates you ever went to the UK.
    marls
    30th Mar 2017
    6:41pm
    johninmelb
    centrelink will know if you actually received a pension from overseas because eg overseas pays the pension to say centrelink headquaters and then centrelink pays you.
    my cousin gets a widows pension from italy and it always comes to her via centrelink and is converted thats how centrelink knows exactly how much you get from overseas pension
    however, it does not work the other way round as my mother now lives overseas on oz pension and her european pension plus a portion of dads overseas pension as he is deceased plus a very small pension from another country as dad was in the war its only australia where theres a means test
    johninmelb
    30th Mar 2017
    7:47pm
    Marls, my UK pension payment comes directly to me from the UK into my bank account - actually it comes via Citibank Europe, who presumably have a contract with the UK Pensions Office to process international payments.

    Centrelink knows about it because I told them I started receiving it. As it is a fixed sum (in UK £) that will never change,I have no need to update my financial records. Centrelink sends me a statement about every 6 months, telling me what exchange rate they used each month to calculate the Aussie value for my Assets and Income tests.

    Apart from that Centrelink has no other input into the matter.

    What happens with Italy is another matter, and outside of my purview. No relevance or interest to me as I am a born and bred Aussie with Aussie parents, grandparents etc, so can't comment.
    RJW1950
    30th Mar 2017
    8:35pm
    Marls just like johninmelb my UK pension goes directly into my bank account via Citybank Europe

    Centrelink have no involvement in my UK pension

    I claim my UK pension as income on my yearly tax return
    Romeital
    27th Mar 2017
    5:12pm
    There seems to be some anomalies in the comments on this subject
    I can only refer to a UK pension as this is what I receive
    The UK pension is paid at frequencys dependent on the amount you are entitled to quarterly ,yearly or other frequencies
    Your UK pension is not treated as an asset but income and if you are assessed under the asset test then your pension is not reduced any further as the asset test has already reduced it
    However if you are assessed under the income test then you will lose half of your UK pension as you AUS pension will be reduced by that amount if you are paid as a couple then it is 25% reduction each
    niemakawa
    27th Mar 2017
    5:28pm
    Yes Centrelink assess everyone according to both income and assets. Whichever produces the less pension then you are assessed accordingly. Nonetheless income (gross amounts) and assets must be updated as they occur and within a reasonable time as the changes may affect the method under which a person is assessed.
    *Imagine*
    27th Mar 2017
    6:10pm
    I too receive a part UK pension for the contributions that I paid into the National Insurance scheme while working there. There was a graduated contributions scheme, where the more you earned, the more you paid. A sort of National Super scheme.
    I pay AUS income tax and medicare levy of 32.5% on 92% of the UK income (8% is considered a return of my own money). Centrelink reduce my tiny part AUS pension by 50 cents in the dollar based on the gross UK income. Therefore, for each $100 that I receive from the UK, my part Australian pension is reduced by $50. When this is added to the taxation and medicare imposition, the Australian Government is gaining $50 + $31.74 = $81.74 for every $100 that is sent to me by the hard working British taxpayer. They send me $100 and I benefit by less than $20 and the AUS Govt benefit by more than $80. This is UK foreign aid to Australia that I imagine the average UK citizen would be horrified to hear about.
    SuziJ
    27th Mar 2017
    9:23pm
    Thank goodness that I don't have to worry about any of this :)
    Scotty
    28th Mar 2017
    11:14am
    I have just paid a company $400 to do all the work regarding receiving a UK pension for me. Wish I had had a go now doing it myself as the comments below make it sound easy to do. I am glad I found out about obtaining a UK pension as I nearly lost mine. I only worked for 7 years in the UK and you need at least 10 years to receive a UK pension but I found out I can buy 3 years worth of credits at approx £140 per year and I will receive a UK pension of approx £44pw - are the British government mad! I can also buy more credits until I am 66 (my retirement age in the UK, 3 years from now) to receive approx £57pw. So June if you have not worked in the UK for 10 years and are still under UK retirement age I would enquire about buying credits to receive a UK pension before you lose it. It is a good investment. I believe for a single person every dollar of income earned per fortnight above $160 the Australian age pension will be reduced by 50 cents.
    johninmelb
    28th Mar 2017
    12:00pm
    Where does this 10 year rule come from?

    I only lived and worked in the UK for about 12 months. I get a UK pension, admittedly a pittance, but my paperwork was processed without any questions.

    I emailed initially, and asked if I was entitled, to which they replied with an unequivocal yes, and gave me an estimate. The final pension once paperwork was processed, was less than the estimate, but who cares.
    Brisand
    28th Mar 2017
    6:38pm
    It used to be 7years minimum to qualify for part pension, with a complcated formula based on about 45 years for full pension. This was changed a few yearsa ago to 33 years for a full pension and 1/33 for each year for part pension starting from 1 year. As you say you can buy back extra years as well. The cost based mainly on employment ect. for class 1 or class 2. Cant remember the difference.
    It only takes an email to UK to get details. If trhey give you the cost for the higher class always query if you can claim the lower cost class. To repeat if your Aus pension is based on income you lose 50c in the dollar and is taxable. If Assett based then its an assett. Its also frozen at the rate you get at day 1 until that final day.
    littlejen
    5th Apr 2017
    11:32pm
    Centrelink will view yr Uk pension as INCOMEunder their rules . Your Aus pension will not be exactly reduced by the full amount you receive from Uk. I have received a Uk age pension alongside my Aus age pension for a few yr .Your Aus pension will somewhat fluctuate with the exchange rate ,but all done by Centrelink. You do need a fair amount of information to claim your Uk pension ,eg places you worked ,last add in Uk etc . If you still know yr Uk National Insurance no that is a help . Centrelinks International service will help you .Also the website already provided is very good .Start the process before you reach yr exact retirement age . Both myself & husband have been through this system.


    Join YOURLifeChoices, it’s free

    • Receive our daily enewsletter
    • Enter competitions
    • Comment on articles