Age Pension: will a UK pension affect my payment?

Denise is confused as to whether or not she needs to apply for a pension from the UK.

Person applying for a UK pension

Denise is confused as to whether or not she needs to apply for a pension from the UK. And if so, what effect will it have on her Australian Age Pension?

Q. Denise
Can you please advise me on how my husband and I stand with our Australian Age Pension? We were told by Centrelink to apply for the British pension, as we had worked there before coming to Australia. We are just wondering if we will be any better off if we receive any money from Britain, or will it just all be deducted from our Australian Age Pension?

A. You will need to apply for a pension from the UK, as Centrelink may stop your Australian Age Pension if you don’t. Any pension you receive from the UK will be counted as income and therefore, depending on other income you receive, may reduce the level of the Australian Age Pension that you’re paid. You can view the current income thresholds here.

In many instances, Centrelink’s international services can help you with your claim for an overseas pension, and if it can’t help it can usually suggest who can.

You can also find out more about claiming a UK state pension at



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    9th Jan 2017
    But if YOU go and live in the UK do not be expecting this country to pay your pension over there!
    Sort of shows The state of affairs here eh what, I guess someone has to sporty the politicians way of life.
    9th Jan 2017
    So when you do get the UK pension (like I organised for my mother in law) and you give the paperwork to Centrelink so they can adjust their payments accordingly - nothing happens! I have to follow it up again (because last time I gave them paperwork to show that I was following it up, they didn't look properly on their system, didn't see it and cut off her pension). Should I assume that they'll wait til this Christmas and send her a nasty letter?!

    9th Jan 2017
    Why claim it as there is no money there to pay it?
    9th Jan 2017
    Can anyone answer this question Please.

    When Joe Hockey announced changes to Pensions.
    I remember when the Media asked him re the Ancillary Benefits the PC offered Part Pensions.He appeared initally not to have taken that into account but then said when pressed they would retain the card so as to retain ancillary benefits.
    The CSC being offered does not offer these benefits in N.S.W and some other States.
    How is the Government going to make this equal for all please.?
    9th Jan 2017
    Centrelink is in turmoil, new rules, old rules, changed rules, and no body seems to know whats going on. I think I've been dudded in my application for pension , and after being put off by the unbelievable horror of doing the forms I have finally looked at all sorts of other peoples worries and incomes and PENSIONS!! and thought according to my result why are these people with assets quite large , even complaining about the loss in pension??? They shouldn't even have one to worry about. But they do? So I am going to find out at last from the financial people inside centrelink as to what I am entitled to. Because there are people out there with a damned lot more than me in assets that have pensions, any wonder I am totally confused. I guess another year of messing around will take place now!
    I am not knocking those people I've just mentioned I believe we are all entitled to a pension of some degree, we worked and paid for it.
    9th Jan 2017
    My understanding is if a person receives a UK pension what they gain from the UK they lose here. Ie they dont get more than we Australians. Correct me if I'm wrong. Also the paperwork isnt as bad as it looks as you jump sections. Go for it if you are entitled to it.
    9th Jan 2017
    The Australian system is overly complex but the outcome is that CentreLink define all UK pension as assessable income, including your own contributions and that which is removed by tax. Therefore, for each $100 that you will receive from the UK your Australian pension will be reduced by $50.(Centrelink income test rules of 50¢ in the dollar. But, some will have their pension reduced dollar for dollar depending on various other rules.)
    If you are taxable because of other income then the Australian tax office will also take $31.74 tax and medicare levy per $100. The Australian Government is therefore gaining $50 + $31.74 = $81.74 for every $100 that is sent to former British workers by the hard working British taxpayer. That is a huge imposition for the British public and part pensioners on a fixed income. Now, post Brexit, there has been a suggestion that the UK pension should be indexed in AUS as it is in Europe and the USA. The Aus Govt will be delighted by this suggestion, as their take will be even greater. British foreign aid to Australia - I imagine that will go down well in the UK papers.
    I know the above is correct because I am in receipt of a part UK pension that is greater in value for my 11yrs working there, compared to my part Aus pension for working here for 35yrs.
    Tom Tank
    9th Jan 2017
    My part UK pension is considered to be income by Centrelink and as such would be liable for income tax.
    Because I do not earn any other taxable income, and my assets are modest, my part UK pension does not affect my Australian aged care pension.
    Should I be in the fortunate position of having been able to accumulate a large superannuation amount, prior to retirement, then my UK pension could well have been taxed.
    Since I only had the basic super, not having worked for the Government or a company that provided anything other than the legal requirement, I retired on a very modest retirement financial base.
    9th Jan 2017
    Yes. Sorry Tom I should have said that "If your income is over the threshold, then this is what happens." Of course if your total income is under the threshold, then your income will not effect the Aus pension. Also, if your Australian pension is based on the assets that you own, and not your income or the income that you derive from your assets, then the income test will not apply. As I said the Australian system is overly complex.
    9th Jan 2017
    Fast eddie you are completely wrong the UK pension scheme has more money than it knows what to do with because their tax system put money into a fund reserved for pensions so that politicians couldnt waste the money on their vote catching spending whims
    Whilst their rules also change if you worked in the UK you can apply to them in Newcastle England for a pension but it will not be indexed it very easy to do as their staff know what they are doing unlike our Centrelink staff
    In terms of the Australian aged pension this is also straight forward to aply for just fill in the form online simple but first get an independant financial advisor to look at you situation as you cannot trust Centrelinks FIS staff to give you the correct information as many of them are simply jumped up office staff who have been upgraded due to having RSI operating a computer and want an even cushier job than they already have
    Irrespective of whether you are income tested or asset tested for the Australian pension it is still worth claiming the UK pension as at most you will only lose half your UK pension when your Australian pension is reduced a net gain in total payments
    In Outer Orbit
    9th Jan 2017
    Sadly the evidence seems to the contrary Romeital. Projections indicate that with the expansion of UK pensioner numbers, almost all of whom are entitled to a pension as UK citizens, AND with a reduced workforce paying taxes, the UK pension system as it stands is wholly unsustainable. Funding the UK's elderly is another time bomb awaiting the younger generation when they grow up, or wake up, like the national debt. The UK's elderly vote, and they have voted to sell out their young, who don't vote. Current standards of living are above underlying affordability, and at some time in the future the chickens will all come home to roost, as they are now doing in Greece, Italy, Spain etc. Australian pensioners are relatively 'disadvantaged' via means testing, but at least the system is still vaguely attached to the real world. Include all property into the assets test and the system would start to appear almost sensible.
    9th Jan 2017
    Denise, there are some online sites that will help you claim a UK pension, start here at
    My recollection, to be carefully checked, is that there is an option for a lump sum payment -maybe for any retrospective payments - for which you are eligible if over 65; or though unlikely, even in lieu of future payments. A lump sum payment would be counted here as as an asset and if you still remain under your pension assets level you could receive the money, but not have it impact your local pension? Anyway check it out.
    In Outer Orbit
    9th Jan 2017
    Every $12 taken in a lump sum knocks $1 off the UK annual pension. Unless you're desperate for some cash, or are confident you can grow your capital faster than inflation, it's typically not a good idea to increase the size of your lump sum (eg if you expect to live another 12 years).
    9th Jan 2017
    The way it was explained to me when I retired, was that if you are entitled to an overseas pension you must apply for it.
    When Centrelink works out your pension, they pay you the difference between the value of your overseas pension and and your Australian pension entitlement. Your overall pension amount (or part pension based on assets & income) is the same as someone without an overseas pension, but consists of the overseas pension plus the Centrelink "make-up".
    Yer man
    9th Jan 2017
    Don't think that Centrelink is doing you any favours. The reason why they tell you that you may be entitled to a British pension is so that they don't have to pay you as much for your Australian one. They even suggested to me to apply for an Irish pension as well. Obviously someone their Tasmanian office knew nothing about Irish politics. The British pension is assessed by the number of years worked and stamps paid . The British OA pension is NOT means tested unlike here.

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