Go Back   English Forum Switzerland > Help & tips > Finance/banking/taxation  
Reply
 
Thread Tools Display Modes
  #1  
Old 05.04.2021, 10:44
fz750's Avatar
Newbie 1st class
 
Join Date: Jul 2008
Location: Bern
Posts: 27
Groaned at 0 Times in 0 Posts
Thanked 8 Times in 7 Posts
fz750 has no particular reputation at present
Double Pension question

Hi all,

I'm 57 and have lived here for 32 years, even shocking to write that somehow, doesn't time fly..

So, one starts (finally..) thinking about retirement - far too late of course, but there you go - better late than never... Of course I have my Swiss 1st and 2nd pillar pension to look forward to (split through divorce in 2012). My 1st pillar is about 3 years short of being 100%, which means a shortfall of about 300.- a month from the full amount.

Because of this, I started looking at my UK state pension, where it seems I have 12 qualifying years. Strangely, I can buy (class3, possibly cheaper class 2..) up to 24 years of voluntary contributions, back to 2006 and up until I retire here (and 2 years later, at 67, in the UK).

The increased pension"return" I would get on buying these 24 years is massively more than investing that same amount of money into my 2nd pillar pension (I have asked.. 10K investment this year would increase my 2nd pillar pension by 600.- a year ) , ridiculously so actually, so I'm wondering where the catch is...?!

Can I really receive my Swiss pensions here (state and private 2nd pillar) in addition to a UK state pension?

A friend mentioned reciprocal agreements between the UK and CH, and i'm wondering if there is a "catch" here, that one cannot receive both, only one state pension in one place?

Does anybody have any experience/knowledge about this?

Thanks
Reply With Quote
  #2  
Old 05.04.2021, 10:49
Belgianmum's Avatar
Forum Legend
 
Join Date: Jan 2010
Location: Neuchâtel
Posts: 12,691
Groaned at 205 Times in 182 Posts
Thanked 20,744 Times in 8,543 Posts
Belgianmum has a reputation beyond reputeBelgianmum has a reputation beyond reputeBelgianmum has a reputation beyond reputeBelgianmum has a reputation beyond reputeBelgianmum has a reputation beyond reputeBelgianmum has a reputation beyond repute
Re: Double Pension question

If you’ve paid into the system for the minimum number of years required you can claim the pension.
My husband has state pensions from Switzerland, UK, Belgium, France and Germany.
Reply With Quote
This user would like to thank Belgianmum for this useful post:
This user groans at Belgianmum for this post:
  #3  
Old 05.04.2021, 11:04
ipoddle's Avatar
Forum Veteran
 
Join Date: Jan 2008
Location: basel
Posts: 1,066
Groaned at 21 Times in 14 Posts
Thanked 1,037 Times in 431 Posts
ipoddle has an excellent reputationipoddle has an excellent reputationipoddle has an excellent reputationipoddle has an excellent reputation
Re: Double Pension question

Quote:
View Post
Hi all,

I'm 57 and have lived here for 32 years, even shocking to write that somehow, doesn't time fly..

So, one starts (finally..) thinking about retirement - far too late of course, but there you go - better late than never... Of course I have my Swiss 1st and 2nd pillar pension to look forward to (split through divorce in 2012). My 1st pillar is about 3 years short of being 100%, which means a shortfall of about 300.- a month from the full amount.

Because of this, I started looking at my UK state pension, where it seems I have 12 qualifying years. Strangely, I can buy (class3, possibly cheaper class 2..) up to 24 years of voluntary contributions, back to 2006 and up until I retire here (and 2 years later, at 67, in the UK).

The increased pension"return" I would get on buying these 24 years is massively more than investing that same amount of money into my 2nd pillar pension (I have asked.. 10K investment this year would increase my 2nd pillar pension by 600.- a year ) , ridiculously so actually, so I'm wondering where the catch is...?!

Can I really receive my Swiss pensions here (state and private 2nd pillar) in addition to a UK state pension?

A friend mentioned reciprocal agreements between the UK and CH, and i'm wondering if there is a "catch" here, that one cannot receive both, only one state pension in one place?

Does anybody have any experience/knowledge about this?

Thanks
I'm in a vaguely similar position. Could you provide links to the UK sites please. Also can you quantify what you mean by getting 'massively' better returns if you 'invest' in a UK pension ? And..does anybody know.. can one write off any payments into a 'foreign' state pension against taxable income ?

Thanks
Reply With Quote
  #4  
Old 05.04.2021, 11:27
fz750's Avatar
Newbie 1st class
 
Join Date: Jul 2008
Location: Bern
Posts: 27
Groaned at 0 Times in 0 Posts
Thanked 8 Times in 7 Posts
fz750 has no particular reputation at present
Re: Double Pension question

Quote:
View Post
I'm in a vaguely similar position. Could you provide links to the UK sites please. Also can you quantify what you mean by getting 'massively' better returns if you 'invest' in a UK pension ? And..does anybody know.. can one write off any payments into a 'foreign' state pension against taxable income ?

Thanks
It's just the pension position provided using your UK national insurance number when you have an account on the uk.gov website. If you don't have a UK national insurance number and pension record, forget it.

As for benefit, it would cost (theoretically, paying class 3 contributions) 19K GBP (approx 24K Sfr) in total for these 24 years at Class 3 rate which, in my case, would boost pension from £60 to £175 a week. (an increase in £6000 yearly, or just under 8K Sfr currently)

If I paid that same money (24K Sfr) into my 2nd pillar pension here it would result in approx 1500 a year increase. so, a no brainer really, from what I can see..

And no, you cannot offset such payments to a foreign pension fund against your Swiss tax unfortunately.
Reply With Quote
The following 2 users would like to thank fz750 for this useful post:
  #5  
Old 05.04.2021, 11:48
fatmanfilms's Avatar
Forum Legend
 
Join Date: Apr 2010
Location: Verbier
Posts: 20,438
Groaned at 430 Times in 321 Posts
Thanked 20,989 Times in 11,073 Posts
fatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond repute
Re: Double Pension question

Quote:
View Post
It's just the pension position provided using your UK national insurance number when you have an account on the uk.gov website. If you don't have a UK national insurance number and pension record, forget it.

As for benefit, it would cost (theoretically, paying class 3 contributions) 19K GBP (approx 24K Sfr) in total for these 24 years at Class 3 rate which, in my case, would boost pension from £60 to £175 a week. (an increase in £6000 yearly, or just under 8K Sfr currently)

If I paid that same money (24K Sfr) into my 2nd pillar pension here it would result in approx 1500 a year increase. so, a no brainer really, from what I can see..

And no, you cannot offset such payments to a foreign pension fund against your Swiss tax unfortunately.
Definitely worth doing, are you sure you can go back that many years, if you can it's a no brainer. Going forward you have 10? years before UK retirement age.
Reply With Quote
  #6  
Old 05.04.2021, 12:37
AbFab's Avatar
Forum Legend
 
Join Date: Sep 2006
Location: Zürich
Posts: 8,122
Groaned at 345 Times in 235 Posts
Thanked 11,668 Times in 4,023 Posts
AbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond reputeAbFab has a reputation beyond repute
Re: Double Pension question

My UK state pension has been converted to CHF and paid into my Swiss bank account monthly for the last 7 years without problem.

For Swiss taxes I simply add the amounts up and put the total on the Swiss tax form, which has never been questioned.

Every couple of year the UK pension people write and ask if I'm still alive. My Swiss bank (ZKB) stamps the form free of charge.

If you pay tax in the UK, it may be advantageous to keep the UK pension there and use your UK tax free allowance...

(Added thought) - if you have been self employed here, the UK state pension pay you more. No idea why and I'm not going to ask!
__________________


************************************
Fed up of smoking? 10 tips to quit in 10 days
Reply With Quote
  #7  
Old 05.04.2021, 13:03
fz750's Avatar
Newbie 1st class
 
Join Date: Jul 2008
Location: Bern
Posts: 27
Groaned at 0 Times in 0 Posts
Thanked 8 Times in 7 Posts
fz750 has no particular reputation at present
Re: Double Pension question

Quote:
View Post
My UK state pension has been converted to CHF and paid into my Swiss bank account monthly for the last 7 years without problem.

For Swiss taxes I simply add the amounts up and put the total on the Swiss tax form, which has never been questioned.

Every couple of year the UK pension people write and ask if I'm still alive. My Swiss bank (ZKB) stamps the form free of charge.

If you pay tax in the UK, it may be advantageous to keep the UK pension there and use your UK tax free allowance...
If one had a UK address would it not be better to have that pension just paid out in the UK? Seems to me that if the Swiss don't allow my any tax relief on paying the contributions for it, that they will not get any extra "income" from me due to it

BTW, some neigbouring countries (Ö..) insist that all their pensioners personally go to their local embassy to prove they are still alive every year plus (I believe) needing evidence of residence from their local community (Wohnsitzbestätigung) so the brits are pretty cool about it..
Reply With Quote
This user would like to thank fz750 for this useful post:
  #8  
Old 05.04.2021, 16:06
Newbie 1st class
 
Join Date: Nov 2020
Location: Geneva
Posts: 16
Groaned at 0 Times in 0 Posts
Thanked 2 Times in 2 Posts
Hemingway has no particular reputation at present
Re: Double Pension question

Quote:
View Post

(Added thought) - if you have been self employed here, the UK state pension pay you more. No idea why and I'm not going to ask!
Could you please link some info on this?
Reply With Quote
  #9  
Old 05.04.2021, 12:56
fz750's Avatar
Newbie 1st class
 
Join Date: Jul 2008
Location: Bern
Posts: 27
Groaned at 0 Times in 0 Posts
Thanked 8 Times in 7 Posts
fz750 has no particular reputation at present
Re: Double Pension question

Quote:
View Post
Definitely worth doing, are you sure you can go back that many years, if you can it's a no brainer. Going forward you have 10? years before UK retirement age.
Yep, and I even have until April 2023 to pay it, no idea why (but that was confirmed by HMRC..)

There might even be the possibility to pay class 2 contributions (£150 a year instead of £780 or so) or a mix (as I was advised by HMRC) for which you have to apply for and which I certainly have.. awaiting the result with baited breath!

My gf couldn't believe these figures, as she'd been quoted 1100 Euros for each MONTH she'd missed from her state pension record in her EU country..

Last edited by fz750; 05.04.2021 at 13:14.
Reply With Quote
  #10  
Old 05.04.2021, 16:15
Phil_MCR's Avatar
Forum Legend
 
Join Date: Oct 2009
Location: Basel
Posts: 14,324
Groaned at 278 Times in 184 Posts
Thanked 17,747 Times in 7,493 Posts
Phil_MCR has a reputation beyond reputePhil_MCR has a reputation beyond reputePhil_MCR has a reputation beyond reputePhil_MCR has a reputation beyond reputePhil_MCR has a reputation beyond reputePhil_MCR has a reputation beyond repute
Re: Double Pension question

Quote:
View Post
Yep, and I even have until April 2023 to pay it, no idea why (but that was confirmed by HMRC..)

There might even be the possibility to pay class 2 contributions (£150 a year instead of £780 or so) or a mix (as I was advised by HMRC) for which you have to apply for and which I certainly have.. awaiting the result with baited breath!

My gf couldn't believe these figures, as she'd been quoted 1100 Euros for each MONTH she'd missed from her state pension record in her EU country..
Yup it is a bit of a loophole and one that is worth exploiting while still available. I've seen it possible to pay back 6 years, but haven't seen as much as 12 before!
Reply With Quote
This user would like to thank Phil_MCR for this useful post:
  #11  
Old 05.04.2021, 21:52
Junior Member
 
Join Date: Mar 2010
Location: geneve
Posts: 74
Groaned at 0 Times in 0 Posts
Thanked 38 Times in 21 Posts
jim1 has earned the respect of manyjim1 has earned the respect of manyjim1 has earned the respect of many
Re: Double Pension question

Quote:
View Post

There might even be the possibility to pay class 2 contributions (£150 a year instead of £780 or so) or a mix (as I was advised by HMRC) for which you have to apply for and which I certainly have.. awaiting the result with baited breath!
Thank you for this thread which triggered me to look into my situation

I am over 10 years younger than you. Despite the longer time to retirement HMRC website says I need to pay the same as you to buy each missing year (between £780-795.60)

If this is the price to gain GBP5 per week UK state pension at age 67 (or 68 or 70...?) my conclusion is that buying years now doesn't make sense in my case. I can invest the cash so that by retirement age it would earn more £5 per week

I will contact HMRC to enquire about class 2 contributions which might change the equation
Reply With Quote
  #12  
Old 05.04.2021, 11:42
Jim2007's Avatar
Forum Legend
 
Join Date: Jun 2006
Location: Kt. Bern
Posts: 4,389
Groaned at 206 Times in 163 Posts
Thanked 7,111 Times in 3,177 Posts
Jim2007 has a reputation beyond reputeJim2007 has a reputation beyond reputeJim2007 has a reputation beyond reputeJim2007 has a reputation beyond reputeJim2007 has a reputation beyond reputeJim2007 has a reputation beyond repute
Re: Double Pension question

Quote:
View Post
A friend mentioned reciprocal agreements between the UK and CH, and i'm wondering if there is a "catch" here, that one cannot receive both, only one state pension in one place?


The main objective of the reciprocal agreement is to ensure you get the maximum benefit out of all your pension contributions in both states. But I think it only really has impact in situations where one does not qualify for a pension in either state.


It certainly does not prevent you from receiving a pension from both states.
Reply With Quote
The following 2 users would like to thank Jim2007 for this useful post:
  #13  
Old 05.04.2021, 19:38
Junior Member
 
Join Date: May 2019
Location: CH
Posts: 89
Groaned at 3 Times in 3 Posts
Thanked 61 Times in 30 Posts
besmegenis is considered knowledgeablebesmegenis is considered knowledgeablebesmegenis is considered knowledgeable
Re: Double Pension question

Hi there,

How you calculate 1st pillar? I was under impression that you need 45 years in Switzerland to get 100%?

Quote:
View Post
Hi all,

I'm 57 and have lived here for 32 years, even shocking to write that somehow, doesn't time fly..My 1st pillar is about 3 years short of being 100%, which means a shortfall of about 300.- a month from the full amount.
Reply With Quote
This user would like to thank besmegenis for this useful post:
  #14  
Old 07.04.2021, 00:12
fz750's Avatar
Newbie 1st class
 
Join Date: Jul 2008
Location: Bern
Posts: 27
Groaned at 0 Times in 0 Posts
Thanked 8 Times in 7 Posts
fz750 has no particular reputation at present
Re: Double Pension question

Quote:
View Post
Hi there,

How you calculate 1st pillar? I was under impression that you need 45 years in Switzerland to get 100%?
You can complete and this and see approx:

https://www.ahv-iv.ch/de/Merkblätter...chätzung-ESCAL


Depends also what will happen here in the next 8 years, seems to be a goal of government to reduce their pension load, which will be an interesting fight with all the people on the landing path to retirement..
Reply With Quote
  #15  
Old 07.04.2021, 09:19
Junior Member
 
Join Date: May 2019
Location: CH
Posts: 89
Groaned at 3 Times in 3 Posts
Thanked 61 Times in 30 Posts
besmegenis is considered knowledgeablebesmegenis is considered knowledgeablebesmegenis is considered knowledgeable
Re: Double Pension question

Yes, I know this website, however after getting estimate click "edit income" and you'll find 45 lines for each year. Make sure you modify accordingly to your work experience and do recalculation.

Or, when filling in the form choose OASI insurance period which matches time you contributed to the system.

Quote:
View Post
You can complete and this and see approx:

https://www.ahv-iv.ch/de/Merkblätter...chätzung-ESCAL


Depends also what will happen here in the next 8 years, seems to be a goal of government to reduce their pension load, which will be an interesting fight with all the people on the landing path to retirement..
Reply With Quote
This user would like to thank besmegenis for this useful post:
  #16  
Old 07.04.2021, 09:23
fatmanfilms's Avatar
Forum Legend
 
Join Date: Apr 2010
Location: Verbier
Posts: 20,438
Groaned at 430 Times in 321 Posts
Thanked 20,989 Times in 11,073 Posts
fatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond reputefatmanfilms has a reputation beyond repute
Re: Double Pension question

Quote:
View Post
Depends also what will happen here in the next 8 years, seems to be a goal of government to reduce their pension load, which will be an interesting fight with all the people on the landing path to retirement..
Covid has helped in this regard.
Reply With Quote
This user would like to thank fatmanfilms for this useful post:
  #17  
Old 05.04.2021, 22:11
Newbie 1st class
 
Join Date: Jul 2009
Location: ZH
Posts: 13
Groaned at 0 Times in 0 Posts
Thanked 8 Times in 7 Posts
sanval has no particular reputation at present
Re: Double Pension question

Quote:
View Post
Hi all,

I'm 57 and have lived here for 32 years, even shocking to write that somehow, doesn't time fly..

... I started looking at my UK state pension, where it seems I have 12 qualifying years. Strangely, I can buy (class3, possibly cheaper class 2..) up to 24 years of voluntary contributions, back to 2006 and up until I retire here (and 2 years later, at 67, in the UK).


As you've been in Switzerland for 32 years, so I guess you left UK when were 25, how come you have 12 qualifying years for the UK pension? Did you already pay for some of those 12 years after you arrived in Switzerland?
Reply With Quote
  #18  
Old 06.04.2021, 22:33
fz750's Avatar
Newbie 1st class
 
Join Date: Jul 2008
Location: Bern
Posts: 27
Groaned at 0 Times in 0 Posts
Thanked 8 Times in 7 Posts
fz750 has no particular reputation at present
Re: Double Pension question

Quote:
View Post
As you've been in Switzerland for 32 years, so I guess you left UK when were 25, how come you have 12 qualifying years for the UK pension? Did you already pay for some of those 12 years after you arrived in Switzerland?
yes, 3. I had nine when I arrived, possibly the year when I arrived I also paid class 3, I don't remember now, making 12

Last edited by fz750; 06.04.2021 at 22:44.
Reply With Quote
Reply




Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Double watch service question Humph General off-topic 1 21.08.2020 06:39
A Very Unique Double, Double, Double, etc, for the Swiss Medea Fleecestealer Football/sports 5 19.06.2017 08:40
Another marriage tax question..... and double residency/tax obligations rjan Finance/banking/taxation 5 23.08.2016 23:48
Yet another pension question Ravenk Finance/banking/taxation 1 28.07.2016 19:32
Zurich London Commute [double taxation question] Shimla Finance/banking/taxation 25 16.03.2007 14:18


All times are GMT +2. The time now is 21:09.


Powered by vBulletin® Version 3.8.4
Copyright ©2000 - 2021, Jelsoft Enterprises Ltd.
LinkBacks Enabled by vBSEO 3.1.0