Latest news with #personalpension
Daily Mail
07-07-2025
- Business
- Daily Mail
How do personal pension contributions affect what Universal Credit I receive? STEVE WEBB replies
I'm on Universal Credit and make contributions into a personal pension in addition to my workplace pension. Unfortunately, I've had trouble persuading Universal Credit to deduct my personal pension contributions from my income. Could you confirm that my pension contributions are deductible? And do you know if they deduct just the amount I pay in, or do they deduct the full amount that goes into my pension which includes the tax relief from HMRC? Steve Webb replies: The good news is that for people on Universal Credit, the money that you pay into any pension is deductible from your income before your UC is calculated. By paying into a pension, your disposable income is lowered and this means you get extra UC compared with someone who isn't contributing to a pension. This makes saving into a pension even more attractive for people on benefit than it is for many other groups. As you have found, whilst the Department for Work and Pensions handles all of this automatically when it comes to contributions made through your pay packet, many people have reported problems getting them to accept that personal pension contributions which you make directly are also deductible. We have covered examples of this problem previously on This is Money: Pension blunder at DWP discovered by Steve Webb means thousands could be underpaid Universal Credit The rules are however quite clear. According to the Universal Credit Regulations 2013, the DWP should deduct any pension contribution you make and not just those made through a workplace pension. The exact wording (from Section 55 of the regulations) is: '(5) In calculating the amount of a person's employed earnings in respect of an assessment period, there are to be deducted from the amount of general earnings or benefits specified in paragraphs (2) to (4)— (a) any relievable pension contributions made by the person in that period' You will see that it says *any* pension contributions and not just those made through a workplace pension. For people who are self-employed, and who declare their income to DWP through the standard UC forms for the self-employed, they should be prompted to provide information about their pension contributions alongside information about their profits from self-employment. These contributions should automatically be deducted from their profits before UC is calculated. But in your case, DWP will not know about the personal contributions that you have made and so you have to notify them each time you make a contribution so that this can be taken into account when your UC is worked out. One other question which arises is exactly what figure they should use. As you probably know, when you pay directly into a personal pension this is topped up by HMRC. For example, if you pay in £80, HMRC will add £20 giving a 'gross' contribution of £100. The £20 is pension tax relief awarded at the basic rate. Those who are higher rate taxpayers can fill in a tax return and claim back additional tax relief. In the old system of working tax credits, which was based around people's gross income, it would have been the full £100 'gross' pension contribution which was deducted. However, under Universal Credit a recent benefit tribunal case in which I was involved has confirmed that for UC purposes it is the 'net' figure which should be deducted. In the example where you pay £80 which is topped up to £100 by HMRC, it is the actual amount that you paid in – the £80 – which is the correct figure to be used in the calculation. Ask Steve Webb a pension question Former pensions minister Steve Webb is This Is Money's agony uncle. He is ready to answer your questions, whether you are still saving, in the process of stopping work, or juggling your finances in retirement. Steve left the Department for Work and Pensions after the May 2015 election. He is now a partner at actuary and consulting firm Lane Clark & Peacock. If you would like to ask Steve a question about pensions, please email him at pensionquestions@ Steve will do his best to reply to your message in a forthcoming column, but he won't be able to answer everyone or correspond privately with readers. Nothing in his replies constitutes regulated financial advice. Published questions are sometimes edited for brevity or other reasons. Please include a daytime contact number with your message - this will be kept confidential and not used for marketing purposes. If Steve is unable to answer your question, you can also contact MoneyHelper, a Government-backed organisation which gives free assistance on pensions to the public. It can be found here and its number is 0800 011 3797.
South China Morning Post
24-05-2025
- Business
- South China Morning Post
Young Chinese put retirement plans on hold amid slowing economy, demographic crisis
For many young people in China, the government's call to prepare for retirement decades in advance feels out of touch with reality. With rising job uncertainty amid a slowing economy , stagnant wages and mounting pressures around housing and marriage, most young employees interviewed by the Post said they were too preoccupied with present circumstances to think about old age – and that retirement was simply too distant to prioritise in a rapidly changing world. 'There's no point constantly worrying about the future – I'd rather just focus on living well right now,' said 29-year-old Wu Ruoshi, a public sector worker based in Wuhan. 'Sure, retirement is important, but just thinking about it doesn't help. It only creates stress. Who knows, maybe I'll have a robot taking care of me when I'm old anyway.' In recent years, the Chinese government, along with many academics, have warned of the long-term risks posed by the country's rapidly ageing population , a trend exacerbated by a strained state pension system. They have urged young people to begin planning early for retirement, and highlight the importance of the newly expanded personal pension system – a voluntary, supplementary programme aimed at encouraging individuals to build up their retirement savings, as part of broader pension reforms.
