Bad News for UK citizens with Thai wives

Discussion in 'Thai Widows & Expats' started by CO-CO, May 30, 2015.

  1. CO-CO

    CO-CO You chose a custom title


    The Pensions Act 2014 became law on 14th May 2015, when it received the Royal Assent. It comes into force on 6th April 2016

    With effect 6th April 2016, Thai Widows, living in Thailand, will not be eligible for any benefits under new laws which are known as Bereavement support payment. To be eligible to receive benefits (formerly known as bereavement benefits).....

    (1) A person is entitled to a benefit called bereavement support payment if—

    the person is ordinarily resident in Great Britain, or a specified territory, when the spouse or civil partner dies,

    Thailand, unfortunately is NOT a specified territory.
    nomad97 and johnb like this.
  2. johnb

    johnb Guest

    Thanks for the bad news, Coco. Does this apply to all UK pensions or just the state one? I have a teachers pension and a state pension.
  3. CO-CO

    CO-CO You chose a custom title

    Just state pension John.

    (I recommend NOT letting your wives know that they have until April 2016 to benefit from your demise!)
    johnb likes this.
  4. Yorky

    Yorky Fullritis Member

    I've had the impression for some time that my Thai wife will not be entitled to bereavement benefit (i.e. the one year weekly payments), however, will the bastards be stopping the one-off Sterling 2,000.00 death benefit?
  5. mahdam

    mahdam Surin Dinosaur

    Thanks for the information CO-CO.
    Does this also apply if the Thai wife also has British Citizenship?
    My wife does and also has a National Insurance number and pays
    her own contributions whilst working in the UK.
    That said she only works in the UK for a maximum of six months in
    every year, and I reckon she will return to Thailand full time when I kick the bucket.
    Last edited: May 30, 2015
  6. CO-CO

    CO-CO You chose a custom title

    Unfortunately, yes.

    It is actually increasing next year as well.
  7. CO-CO

    CO-CO You chose a custom title

    As I understand it she will have to ordinarily resident in the UK at the time of death.
    mahdam likes this.
  8. Yorky

    Yorky Fullritis Member

    Then it will be the reduction in personal tax allowance to zero, then the increase in the minimum taxation to cover the abolition of NHI contributions, by which time I'll be paying them!

    I guess someone has to pay for the MP's 11% pay increase and their iPhones.
  9. CO-CO

    CO-CO You chose a custom title

    From the House of Commons notes on the Pensions Bill:-
    Bereavement support payment

    Steve Webb: I beg to move amendment 1, page 14, line 11, after ‘dies,’ insert—
    ‘() the person is ordinarily resident in Great Britain, or a specified territory, when the spouse or civil partner dies,’.
    The Chair: It will be convenient to discuss Government amendments 2and 3.
    Steve Webb: We move on to part 3 of the Bill, which relates to reforms of bereavement support payments. It may help to explain the purpose of amendments 1 to 3 if I briefly explain the framework of the reforms contained in clauses 27 and 28.
    As the Committee will know, with the exception of changes made for widowers about a decade ago, the system of support for bereaved families has been largely
    Column number: 265
    unchanged since the post-war period. It was very much based on the assumption that men went out to work and women stayed at home—a woman who lost her man, lost her income, and therefore needed a national insurance benefit for herself and her dependent children. It is perfectly proper for a Government in the 20-teens to ask whether that model is any longer appropriate. The current model has several problems. For childless widows and widowers, there are obscure and complex age rules. For example, what one might think of as the widow’s pension, or the bereavement allowance, is not payable at all for those under 45. It is payable on a tiered basis up to the age of 55, and then there are complicated contributions rules overlaying all that. Most people would feel that that is a degree of complexity. For someone who is a young widow or widower, it is hard to see why there should not be an entitlement to any help over the following 12-month period. Therefore, dealing with the gaps in the system is one factor.
    The second factor is the support given to bereaved parents. As I said, the existing system almost reflects a 1940s model: a bereaved parent has lost the breadwinner, who would have supported them for as long as their children were children, and therefore, that person should have an allowance that runs for 16 years, 18 years, or whatever. Although absolutely nobody would want to be in a bereaved parent’s position, the reforms are trying to focus the financial help that is given to bereaved parents on the time of bereavement and the immediate period thereafter, while putting in place a longer-term system of financial support for those who do not return to the labour market. Therefore, the idea of the reforms, both for the childless and for bereaved families with children, is to concertina the support into a substantially increased grant, death grant, or lump sum, consisting of several thousand pounds more than the current figure, we envisage. Monthly payments will then be paid over the following 12 months; those are essentially a broken-down bit of that first lump sum. Essentially, that replaces an ongoing weekly pension that can go on for the best part of two decades, in extreme cases, with very substantial help in the first part of the period.
    One of the changes we are making is to relax substantially the national insurance contribution rules. Whereas the bereavement allowance currently requires extensive payments—a lifetime’s worth—of national insurance for a full pension, we think that is simply inappropriate. In fact, the contribution rules have been so dramatically relaxed that we require only 25 weeks’ national insurance. In other words, someone must spend less than a year in the system to qualify for the payment. A problem with that, which we identified after we printed the Bill—as the Committee might work out, that is why we have tabled the amendment—is that that would mean that bereaved people around the world, who, I hesitate to say, even if they had not seen the white cliffs of Dover, had certainly spent six months in the country paying national insurance, would qualify for a bereavement lump sum. Given that the amounts of money are substantial, we did not think it the priority for the British taxpayer to pay bereavement support payments to bereaved people around the world—although, of course, we sympathise with them—who have simply had a passing acquaintance with the country.
    Amendments 1, 2 and 3 together set out that there will be a test of being ordinarily resident in the country, of the sort that is familiar in the benefit system. Amendment
    Column number: 266
    1 would prevent persons living in a non-EEA or non-reciprocal agreement country, without a close connection to Great Britain, coming to the country to claim the benefit. Amendment 2 provides that the Secretary of State will make regulations that specify the rate and period of payment. Amendment 3 provides that regulations may specify countries other than Great Britain in which a person has to be ordinarily resident, such as elsewhere in the EU, to be entitled to the bereavement support payment. In a sense, the set of amendments—the matters we are dealing with narrowly at this point—simply try to ensure that we pay the money to people who have contributed to the system and who are ordinarily resident here, which I am sure is what the public and Parliament would expect us to do. On the strength of that, I commend the amendments to the Committee. Gregg McClymont: Amendment 1 seems pretty straightforward and I have nothing further to add. However, will the Minister elaborate on the impact of amendment 2, which would insert the phrase
    “leave out ‘Regulations are to’ and insert ‘The Secretary of State must by regulations’.”?
    Bluntly, what is the amendment’s point and how does that change materially affect the Bill?
    Steve Webb: I am grateful to the hon. Gentleman for that question, because, as I entirely accept, the answer is not self-evident. I can reassure him that it is a minor and technical amendment, clarifying that the Secretary of State will—that is the important word—make regulations under subsection (2), which specify, as one would expect, the rate of payment for this benefit and the period of payment. It requires the Secretary of State to do that; it is a tidying-up amendment.
    Amendment 1 agreed to.
    Amendments made: 2, in clause 27, page 14, line 13, leave out ‘Regulations are to’ and insert ‘The Secretary of State must by regulations’.
    Amendment 3, in clause 27, page 14, line 26, at end insert—
    ‘“specified territory” means a territory specified in regulations made by the Secretary of State.’.—(Steve Webb.)
    Question proposed, That the clause, as amended, stand part of the Bill.
    Steve Webb: I have given the Committee a flavour of the thinking behind these reforms, but I will just run through clause 27.
    As we would expect, the trigger for the bereavement support payment is that the person’s spouse or civil partner dies. This does not apply to cohabiting couples, which may be an issue we want to discuss, but in line with current provisions for bereavement benefits this is based on legal marriage and civil partnership. It applies to people who, when they are bereaved, are under state pension age; obviously, there are different arrangements for provision for widows and widowers above state pension age, through the pension system. It is a contributory system and the contribution test is set out in clause 28, so I will not dwell on that now.
    Clause 27(2) as now amended requires the Secretary of State to specify what the rate of benefit is and how it long goes on for, which we thought we probably should
    Column number: 267
    do. The rates can be different. For example, there could be—as we envisage—an initial rate and a rate per month, and there could be different rates again, as in subsection (4). We envisage higher rates for people entitled to child benefit. So we envisage that the lump sum would be higher for families with children. We do not currently envisage that the periods will vary between families with children and families without children, but we have put that flexibility in. One of the reasons we have done that is that this package of measures is not about saving money. At the illustrative rates we have provided, it will cost the Exchequer an extra £110 million in the next Parliament, so it does not save money in the next Parliament. However, in the long term, as the grandfathered recipients—for want of a better phrase—of the old benefits gradually come out of the system, the replacement system will, over time, start to save money.
  10. Pipe down Conservative supporters.
  11. Yorky

    Yorky Fullritis Member

    This Steve Webb, CO-CO?:

    Steve Webb attracted media attention in March 2014, when he remarked in a television interview that due to the coalition government's pension reforms, he was relaxed if pensioners wanted to spend their savings on a Lamborghini.
  12. AussieBill

    AussieBill Guest

    Does all this mean that, should you pommies get seriously ill, you should grab the wife and race back to the UK?

    If you are too seriously ill, it would be an advantage if you could expire before 16 April 2016.
  13. Yorky

    Yorky Fullritis Member

    Only to your wife, not to you (or me).
    Prakhonchai Nick likes this.
  14. Prakhonchai Nick

    Prakhonchai Nick You chose a custom title

    Indeed it would Bill - 6th April being the operative date.

    For those Brits who expire on or before 5th April 2016, bereavement benefits under the old scheme are still claimable, which includes the £2.000 lump sum together with widowed parents allowance if there are eligible children, or widows allowance (provided the widow was aged 45 or more on date of death). Even then, if the Brit was in receipt of a state pension, which was frozen by virtue of him living permanently in Thailand, the bereavement benefits (not the £2,000), will be linked to the amount of BASIC state pension when it was frozen. Any extras added on to the state pension (GRP, Serps or dependents allowance) are not included.

    From 6th April,2016 basically nothing, unless the wife is regarded as ordinarily resident, which may be the case for Mahdams wife.
    johnb and mahdam like this.
  15. CO-CO

    CO-CO You chose a custom title

    "A reference to the dictionary and judicial comments upon the meaning of these terms indicates that one is "ordinarily resident" in the place where in the settled routine of his life he regularly, normally or customarily lives....
  16. AussieBill

    AussieBill Guest

    Does that make Mahdam's 6 months in the UK and 6 months in Thailand any easier to explain?
  17. Prakhonchai Nick

    Prakhonchai Nick You chose a custom title

    Mahdam's wife has British citizenship on her side. She works, pays NI contributions, so should be entitled to the new bereavement support payments when Mahdam departs. In addition, whilst working and paying NI contributions, she is creating an entitlement for herself to the state pension, at whatever age they will pay it to her in the distant future. Her 6 months in Thailand will likely be regarded as holiday.
  18. CO-CO

    CO-CO You chose a custom title

    She will also get free hospital treatment (unlike me, who has paid 35+ years National Insurance Contributions):-

    We are often asked about medical care on vacation in the UK. These recent changes to the official rules may be of interest to anyone planning to travel to the UK this year.[FONT=&quot][/FONT]
    Changes to NHS charging regulations will also affect former UK residents.[FONT=&quot][/FONT]
    Overseas visitors who need healthcare while in England will soon be charged differently for using the NHS as part of efforts to recoup £500 million a year by 2017 to 2018.[FONT=&quot][/FONT]
    From April 2015 the way the NHS charges these visitors is being changed so that it does not lose out on income from migrants, visitors and former residents of the UK, who should all pay for their care while in the country.[FONT=&quot][/FONT]
    Within the UK, free NHS treatment is provided on the basis of someone being ‘ordinarily resident’. It is not dependent upon nationality, payment of UK taxes, national insurance contributions, being registered with a GP, having an NHS number or owning property in the UK.[FONT=&quot][/FONT]
    The changes, which come into effect from April 2015 will affect visitors and former UK residents differently, depending on where they now live.[FONT=&quot][/FONT]
    Treatment in Accident & Emergency departments and at GP surgeries will remain free for all.[FONT=&quot][/FONT]
    People living outside the European Economic Area[FONT=&quot][/FONT]
    People who live outside the EEA, including former UK residents, should now make sure they are covered by personal health insurance, unless an exemption applies to them. Anyone who does not have insurance will be charged at 150% of the NHS national tariff for any care they receive.[FONT=&quot][/FONT]
    There are several groups of people who are exempt from charging, or entitled to free care because they remain ‘ordinarily resident’ despite spending time outside the UK. UK Crown servants, British Council or Commonwealth War Graves staff, those working in UK Government-funded posts overseas, and the spouse/civil partner and children under 18 of these people, are exempt from charging if they were ‘ordinarily resident’ prior to leaving the UK for that purpose. Those who were not ‘ordinarily resident’ in the UK before taking up such a post will be charged.[FONT=&quot][/FONT]
    There is also no change for armed forces members, war pensioners and armed forces compensation scheme recipients and their families, who are not required to have formerly been ‘ordinarily resident’ of the UK.[FONT=&quot][/FONT]
    Returning to the UK to settle[FONT=&quot][/FONT]
    Citizens who return to the UK on a settled basis will be classed as ‘ordinarily resident’, and will be eligible for free NHS care immediately.
  19. CO-CO

    CO-CO You chose a custom title

    ... and this one:-

    Early day motion 1203


    That this House asks the Social Security Advisory Committee to consider Statutory Instrument 2007 No. 775, the Social Security Benefits Up-rating Regulations 2007; calls on the Government to provide a remedy to the unjustified and unjustifiable discrimination against the 50 per cent. of overseas UK state pensioners in certain countries including Australia, Canada, South Africa and New Zealand; and requires the Government to present any future Instrument, Regulation or Order that purports to continue the application of disqualification in respect of inflation or other uprating of benefit as an independent Instrument, Regulation or Order instead of tucking it away in Clause 3 of a Regulation misleadlingly titled Uprating.
    Signed by Steve Webb: 15.05.2007

    Have a look also at the Hansard record
    this contains a record of his speeches during the debate on the pensions bill. This leaves no doubt that he supported us, and tried to have a clause in the bill that would have abolished pension freezing.

    One of our intrepid researchers drew attention to this gem:

    Steve Webb (Shadow Secretary of State for Work and Pensions March 2004 said this:

    The purpose of the new clause is to provide that the pensions of those who now live overseas should be annually uprated, wherever they live.

    The moral claim rests on the fact that we have a contributory pension system. We ask people to make contributions all their life to accrue an entitlement. Why should that accrued entitlement vary according to where they choose to live? Much of the Bill concerns choices, flexibility, and people gaining new sorts of retirement, but the system arbitrarily says that one's entitlement is greatly reduced if one chooses to live in such places, rather than a few miles down the road.

    The world has moved on, and people's lives are much more global. People are more likely to work overseas, and their parents may want to go and live with them in retirement. Should we penalise those who retire overseas to be with their children, or should we say, You've worked hard and paid hard. It's your pension take it with our blessing ?
    Merlin, nomad97, Yorky and 1 other person like this.
  20. adam

    adam Surin relic

    Where does that leave me then CO-CO, mystatus for UK Tax is not normally resident and I am NT Tax coded. But I spend 8 months of my life on ships, which is where I regularly, normally or customarily lives. When I come to Thailand I am a tourist.
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