Taxation of British pensions in Australia
If you received a pension from the United Kingdom State Pension
(previously known as the British National Insurance Scheme), you may be
entitled to a UPP deduction.
For a category A pension or a category B widow's pension, you can
calculate your deduction by multiplying your UK State Pension (in
Australian dollars) by 8%. If you want your UPP calculated using the
Exact method, you will need to write to us and request a private binding
If you received a category C or D pension you are not entitled to a deductible amount of the UPP.
Categories of British State Pensions
The categories of contributory SP available are:
- Cat A - category A pensions, comprising basic and
additional pensions, are paid to individuals based upon their qualifying
NI contributions. In certain circumstances, spouses and civil partners
were able to inherit these when the principal recipient died.
- Cat B - category B pensions, comprising basic and
additional pensions, are paid to the surviving spouses and civil
partners of deceased category A recipients where the survivor is not
entitled to category A pension.
- Cat ABL - category ABL pensions are paid to married
persons and civil partners when a person’s own category A basic pension
is less than the maximum amount payable and they are able to ‘top up’
using their spouse or civil partner’s NI contributions.
- Cat BL - category BL pensions are paid when a person
has no category A basic pension entitlement but can claim an SP using
their spouse or civil partner’s NI contributions.
- Cat AB - category AB pensions are paid when a
person’s own category A basic or additional pension is less than the
maximum amount payable and they are able to ‘top up’ using their
deceased spouse or civil partner’s NI contributions.
- GRB only
The categories of non-contributory SP are:
- Cat C - category C pensions are payable to people
over SPa on 5th July 1948 and their widows – the only remaining
entitlements are payable to widows.
- Cat D - category D pensions are awarded to people who:
- reach 80 years of age
- satisfy certain residency conditions and
- failed to qualify for category A or B pension or
- receive less by way of basic pension than the rate of Category D pension.