Inheriting UK State Pension on Death
Published / Last Updated on 28/02/2023
UK State Pensions changed in April 2016 to fanfare and ‘self patting’ on the backs by the government.
Before 6th April 2016 - Basic State Pension (BSP) and State Second Pension (S2P)
- National Insurance Credits for BSP: Paying national insurance contributions or receiving credits such as: if you stayed at home to look after children, was a carer or unemployed to build up credits.
- 30 qualifying years of credits to get a full basic state pension.
- Rate in 2016 = £119.30 per week.
- On death, surviving spouses could inherit some or all their deceased’s partner’s BSP on death if they were short on their own national insurance credits or had paid a reduced ‘married woman’s stamp’.
- State Second Pension (S2P) was a second-tier pension also paid for by national insurance contributions, it originally started as SERPS (State Earnings Related Pension) in 1978 with rules changing to S2P in 2002. Many people contracted out of SERPS/S2P via their own private pension or company pension so that pension rights built up there rather than in a 2nd layer of state pension. S2P stopped in April 2016.
After 5th April 2016 – New State Pension (NSP) only
- National Insurance Credits for NSP: In the same way, paying national insurance contributions or receiving credits such as: if you stayed at home to look after children, was a carer or unemployed to build up credits.
- 35 qualifying years of credits to get a full ‘new’ state pension.
- New State Pension rate in 2016 = £155.65 per week, significantly higher than the old Basic State Pension.
- No more 2nd tier State Second Pension/SERPS.
- On death, surviving spouse do not inherit their deceased partner’s pension. Your State Pension is now based upon your own national insurance record only.
As you can see, the rules for death benefits changed from April 2016 and the position is not so favourable. In simple terms, the only amount you can inherit from your deceased spouse if they pass away is half of their Protected Amount.
Protected Amount Addition
The Protected Amount is the amount of old-style State Pensions that you had earned/built up before April 2016 (adjusted for inflation) that is paid if higher than the full new State pension i.e., if your protected amount is £220.00 per week, this is higher than the New State Pension at £203.85 per week (April 2023), so you will receive £220.00 per week under New State Pension rules (£16.15 per week more).
The full New State Pension from 6th April 2023 will be £203.85 per week but if you were already entitled to £220.00 per week based on contributions prior to April 2016, in the event of your death your spouse could receive an additional £8.08 per week (half of the protected amount excess) on top of their own individual New State Pension entitlement (£220.00 - £203.85 = £16.15 / 2 = £8.08).
