Universal Credit and Private Pension

[Seabubbles]

Can someone please help me as I have 2 conflicting responses on my UC journal. I asked them if my Private Pension payments were deducted from my salary when assessing my Award, in the same way a workplace Pension is. One person replied and said Yes, I need to send them evidence of my payments, and then someone else replied on the journal and said this is incorrect. I've asked for clarification several times and am now not receiving a response. Has anyone here ever heard of this please? Gov.uk mentions it as well. Thanks

If pension is deducted by the employer and your net pay reduced then I'd expect UC to use the net figure as reported to HMRC by the employer.

Is the net pay on your payslip the same as UC show on your statement?

It's the private pension I pay into after recieving my salary. One person at UC advised me that this also counts, someone else said it doesn't. I found this information on gov uk and I've posted the screenshot

Follow the advice on .gov and send them a link to it.

My understanding is that private pension contributions aren't deducted for UC if you are employed.
(They were for Tax Credits).
That screenshot is interesting as it contradicts the research I did into it - albeit that was about 2 years ago.

I thought private pension contributions did reduce income if you are self employed.

https://forums.moneysavingexpert.com/discussion/6449967/universal-credit-and-pension-contributions
Is interesting.

See even on that forum there isn't a straight answer, people disputing everything. One person on my journal said yes then someone else said no. It's really hard to get a straight answer yes or no.

Yes, I agree.
And some of the posters on that thread are adamant. I wish I'd come across it a couple of years ago.

It is being investigated by UC after they just couldn't tell me on the phone, so I'll update with their final decision

See page 5 of this DWP guidance which says:

Pension contributions
For most people, personal and occupational pension contributions are deducted
from pay automatically by the employer. This is known as a workplace pension.

These pension contributions that are paid into a pension scheme via the
claimant’s employer and are being deducted from earnings before tax, are
disregarded. This means the earnings figure used is gross taxable pay minus
Income Tax and National Insurance contributions.

Claimants may opt out of a workplace pension and choose to make payments
into a registered personal or occupational pension scheme, which are not paid
via their employer. Where contributions are taken after the earnings have been
taxed, the pension contribution is deducted from the reported RTI figure.

For claimants paying into a workplace pension this will be done automatically via
the RTI feed. Claimants who pay into a private scheme will need to provide
evidence of their pension payment every month, for each payment.

Only money paid by the claimant into the pension, will count. Any tax relief or
amounts paid by third parties is not to be deducted.

data.parliament.uk/DepositedPapers/Files/DEP2025-0364/186._Treatment_of_earnings-Guidance_V14.0.pdf

So UC will need to see evidence of your pension payment every month so they can deduct it from your net earnings. Then your UC will be based on 'Net pay minus pension' rather than 'net pay before you've paid a pension payment'.

Thank you, I can easily do this as it shows on the app I have and also the bank statements

Hi, I pay into a SIPP private pension and get UC. It is an absolute nightmare. Each month I have to upload my statement showing the amount being paid to my SIPP, then each month, I have to tell them my award is wrong and then they escalate to a decision maker. Sometimes it takes 2 weeks, sometimes 6 weeks before they agree that yes my SIPP payment counts and then I get the full award but it could be 6-8 weeks late and in that time, I’m already starting the battle for the next payment! If I weren’t desperate, it wouldn’t be worth it. There is guidance on one of the money saving expert forums about the legislation as nobody I spoke to knew about it. I sent the guidance to my MP who intervened and I got a year of back payments but apparently no way to resolve it going forwards 🙄

Good luck with it and ask for it to be referred to a decision maker if they don’t agree.

My goodness! Thank you for your response - how do you upload the evidence please, I don't even know how to do that and they can't tell me

Thank you

Check money saving forum.
Paying into a pension should be taken into account and your income lowered, but it’s a battle as they claim ignorance and make it hard work on purpose.

you have to ask them for an upload every month to provide the evidence. I just send my bank statement. Luckily it clearly says SIPP as the reference. They have to have agreed at that point that you are entitled to it being taken into account.

Thank you so much for your help

I am sorry? Out of your income, you have enough to put into a SIPP, but you receive UC?
I seriously despair at benefit bashing on this forum, but are you kidding me?
You are actually asking how much of your UC (paid by taxpayers) you can save and put away?
Am I being an idiot here? Please tell me I am and I have misunderstood?
As I said, the last thing I want to do is benefit bash, but how on earth are you asking about private pension payments whilst receiving UC?

Am as just confused as @Neededa. If its a private pension and you decide how much to pay in, could you then save enough of pay to get into threshold to receive UC while creating a huge pension pot?

Isn't it?

I'm on UC and I receive a pension, the amount of that pension is deducted from what I receive in UC.

I also pay in to a pension and they do nothing about that, it's just something I pay.

Every April when my pension goes up I have to explain in words of one syllable and in writing in triplicate that my pension has increased. This usually takes about 2 weeks because they cannot comprehend a person under 60 getting a pension.

Yes you can. I couldn't believe it either but it was in the newspaper a few weeks ago.

you can save peanuts into a SIPP. You don’t need to be creating a huge pension pot. It’s the same as if you receive a pension through your work - that’s deducted at source but nobody has an issue with that. It’s trying to avoid destitution in retirement. When you earn peanuts, whatever retirement you have, it won’t be luxurious.

If you pay into a pension it should be taken into account as your income if it doesn’t come out of your salary.

Can you only save peanuts @user1497535565 ?
Definitely something to look into!