New British pension rules have taken effect, prompting the group British Pensions in Australia (BPiA) to warn expatriates what may be in store.
The UK State Pension Law, which came into force on April 6, affects men born after April 5, 1951, and women born after April 5, 1953.
Those who receive the pension will not be affected.
The main changes are that to be eligible to receive a full British pension you will now need to have accumulated 35 full years of National Insurance Contributions.
BPiA honorary chairman Jim Tilley said that unless you have a minimum of 10 years of contributions you will only be able to claim a UK pension based on the level (number of years) of your own contributions.
Although until recently a spouse or legal civil partner was able to claim on their partner’s contributions, this will no longer apply to those born after the dates in the new law.
Other changes are in the calculation of the basic state pension. Previously, the pension was calculated using three components: basic state pension, graduated pension and state second pension.
But these will all be combined into one amount, which for those living in Australia could be a slightly higher amount than they would have received under the previous system.
Mr Tilley said many of those affected by this law change will find that when they reach pension age, they are not entitled to receive a pension because they have not have paid the minimum 10 years of contributions.
Those in this situation will forfeit the years already paid for.
But options are available to make further contributions to prevent the loss of years already paid for and at the same time enhancing a pension.
These options might not, however, be available in the same format after April 5, 2017, as legislation is being discussed in Britain to make further changes.
For more, phone BPiA on 1300-308-353 or 9521-7964, www.bpia.org.au