Tax and retirement - SERPS and Pension


Unfortunately, the position is more complicated for older couples. If both partners reached pension age before 6 April 2009, the woman must choose between her own pension and the pension paid on her husband's contributions. She can get one or the other. If she chooses her own pension, she loses the whole of her married woman's pension. Her pension is usually less than the married woman's pension, so it is not

usually worth claiming it unless the tax relief exceeds the loss - in other words, unless her own pension is more than 79 % of the one due on her husband's contributions which normally means that it must be more than £18.9 6 a week.

However, this more restrictive rule does not apply if either she was born after 9 April 1919, or her husband was born after 9 April 1938. Then it is always better to claim her own pension if her husband pays tax. Moreover, the rule does not seem to be applied to women who got their pension because of the final abolition of the half test in 2012.

Women born before 6 April 1939 who received a letter from the DWP in 2009 informing them that they had been given a pension in their own right and that the letter was 'for tax relief purposes only' can use the letter to ensure their husband gets the tax relief whenever he was born.

Details of how married women can sometimes claim pensions of £10.89 a week and more from

contributions paid over forty years ago are in a new edition of the leaflet Pensions from the Forties, available from ACE Money Guide, ACE Magazine, ACE Building, Middelburg Square, Folkestone, Kent CT80 1AZ.

Widows or divorced women who have remarried over the age of sixty should note that they can set their retirement pension paid on their late husband's contributions against their wife's earned income tax allowance.

If you are self employed, the income that counts for tax is not the current year's income .


More information

Additional income and benefits


People registered as blind receive an extra tax allowance of £980.
Income from your company pension is taxable. Normally it is taxed at source before you receive it and the Inland Revenue give the pension payer a tax code for you so that they can calculate the tax due. You will be sent a copy of the notice of coding which shows how the tax code is calculated.
The tax code is worked out as follows. Your tax allowances are the amount of money you can have each year without paying any tax.
Your DWP retirement pension is taxable, so the Revenue deduct the amount of that from your allowances to leave the amount of income you can have before you pay tax. For example, your age allowance . . . ... see: Additional income and benefits