Service Pension. Unearned Income?

Discussion in 'Armed Forces Pension Scheme' started by heidtheba, Apr 15, 2008.

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  1. The old fella that runs our local Legion is having dramas with the local council.

    Basically, he is 67 and on state pension, as well as his service pension. He asked for normal stuff, reduced rent, council tax, etc, and been told that his service pension is 'unearned income', so is not entitled.

    Surely this is b******ks?

    Anyone shed any light?
     
  2. According to HMRC rules, pension income is earned income. However there is nothing except the common-sense of the councillors :? stopping your local bunch of charlatans introducing completely different rules.

    Hope, but unfortunately doubt, this will help. The precise definition is apparently in 'ICTA88/S833 (4)-(6)', whatever that is.
     
  3. Thanks mate, thought so :evil:

    Wan*ers :x
     
  4. Sixty

    Sixty LE Moderator Book Reviewer
    1. ARRSE Cyclists and Triathletes

    The technical term is 'talking out of their hoop' since unearned income is generally held to be investment income (dividends from shares, distribution from bonds, income from property and so on).

    As Idrach says though, it really is depending on the criteria the local government mongs are using.

    Which council is it?
     
  5.  
  6. This has been going on for lots and lots of years.

    I can remember my dad getting worked up about exactly the same wording when it was applied to his Army pension.

    I think the problem is that as the pension is a non-contributary one then it can be classed as unearned as you never paid any money into it.

    Total tax robbing bollards but you can't get away from the cnuts.
     
  7. The pension is not non-contributory. It is part of our pay settlement and taken into account by the pay review board.
     
  8. Forces pensions are usually described as non-contributory, but that is not the same as "unearned":

     
  9. [self-deleted - duplicate]
     
  10. I went into this quite deeply when my turn came to get one. Seems the easiest way is to regard the 22+ or whatever as qualifying you for a pension. The actual money paid as pension is deemed unearned. One does nothing at the time it is paid.
     
  11. sorry for being a mong, but what does that mean in terms of the orginal question?

    Can he fight it, or is it a lost cause?
     
  12. Sixty

    Sixty LE Moderator Book Reviewer
    1. ARRSE Cyclists and Triathletes

    Heid, if you're willing to leave it with me until the weekend I'll make some calls.

    I'm kind of hampered by being TA, meaning that I don't know the ins and outs of the Army pension but I do work in Pensions (albeit in fund management) and can speak to some experts for you.
     
  13. Thanks Sixty, if you can get anything in black and white it would be brilliant.
     
  14. My case - lost cause
     
  15. But was that at the end of your 22+, or post 65 as Heed's acquaintance is? Whether you are of pensionable age does make a difference in many cases, to your entitlement to benefits (but not to your tax treatment by HMRC). There are exceptions (disability pensions etc) but I can see how a council would categorise a 50 year old on what may very well be close to the national average income just from their MOD pension differently to the same person at 65 (on a higher pension 'cause the index linking has kicked in.)