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Advice Needed: NS liability for new PR

Relocating, travelling or planning to make Singapore home? Discuss the criterias, passes or visa that is required.
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Re: Advice Needed: NS liability for new PR

Postby sundaymorningstaple » Tue, 16 Feb 2016 1:17 pm

That's okay squirrel. My only complaint with BBC is that I envy his ability to keep to 'his' outline when constructing replies. While they are long winded, verbal avalanches of information, they are constructed around an outline that doesn't repeat itself (like mine almost always do). Literature and prose were never this dairy farmer's strong point and I have a tendency to using the same system one would use to control a stubborn animal, blunt force. I give information as well, but I rile people with my prose, BBC just puts them to sleep. ;-) Although, oddly enough, I am compelled to read and reread most of his essays as there is a hell of a lot of knowledge there. He reminds me, not so much of JR8 but more of ksl when not writing in an alcoholic haze brought on by Baron's at 3 am in the morning, may he rest in peace.

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Re: Advice Needed: NS liability for new PR

Postby Primrose Hill » Tue, 16 Feb 2016 1:47 pm

hey, how about your opinion on UK/NI then? I sure can use some advise

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Re: Advice Needed: NS liability for new PR

Postby BBCWatcher » Tue, 16 Feb 2016 2:21 pm

Well, since you asked, and assuming you qualify for U.K. NI benefits, here's what I know. If you're a resident of Singapore you can't get the up to £300 annual Winter Fuel Allowance (you're not in the EU/EEA, and it's too warm). Many retirees viewed the WFA as their "Christmas bonus," but the U.K. government has clawed it back to a great extent. (Maybe that's understandable. The WFA was never part of the national pension scheme itself.)

What's truly awful (and indefensible in my view) is that your U.K. national pension benefit is frozen because you won't get annual cost of living increases while you live in Singapore. That's a permanent loss for as long as you collect benefits in Singapore, never recoverable. The best you can do if you move to a country where annual increases apply is to pick up only future increases starting from your frozen monthly benefit level. Given that reality, it might make sense to try to establish and maintain at least minimum legally compliant residency in one of the countries where annual increases are granted when it comes time to collect NI benefits, and especially in the earlier retirement years when benefit freezes would be most harmful. Of course that's not to say you spend £500 to get back £5 -- you still have to approach this problem reasonably.

Given the freeze problem, it's hard for me to imagine you'd make voluntary contributions into U.K. NI (which you're sometimes able to do) if you plan to retire in Singapore unless you're trying to "top up" to qualify for any benefits (to get to the 10 year minimum, including treaty countries).

OK, that's about all I know about U.K. National Insurance. ;)

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Re: Advice Needed: NS liability for new PR

Postby JR8 » Tue, 16 Feb 2016 2:51 pm

ecureilx wrote:SMS, I told you, BBCW is a clone of JR8 !


P*$$ of Squirrel
Was that brief enough for'ya? :lol: :wink: :cool:
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Re: Advice Needed: NS liability for new PR

Postby Primrose Hill » Tue, 16 Feb 2016 2:55 pm

Thank you, BBC. JR8, what say you?
I am currently paying voluntary NI contributions Class 2. I don't intend to retire here. Retirement is a long way off but hoping to be back in EU/UK in 6/7 years time.
We are PR and currently plan to leave the CPF here until.... whenever really

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Re: Advice Needed: NS liability for new PR

Postby JR8 » Tue, 16 Feb 2016 3:10 pm

UK-NI is not an area on which I'm any kind of SME. The rules are constantly changing, and that is (IMO) against a background of any retirement benefits being subject to constant attrition. Years away as an expat during which I was unaware I should voluntarily maintain NI payments, plus a relatively short career in 'employment' (vs self-employment) mean I haven't the longest of records of NI contributions.

That said a few years ago I did look into it, and realised I could make some back-dated payments (a grand or two IIRC) to cross the minimum required lifetime thresholds. And I believe making such back-dated payments is an ongoing possibility. Seems pretty dumb now when for example I've 2-3 years of likely worthless contributions made to the US system and a contemporaneous hole in my UK record, but that's how that particular relo-package happened to be set up.

But as suggested I reckon by the time I'd have call on UK retirement benefits they're not going to be worth claiming. That's a core reason for why I have so much focus on investing and providing for myself. A greater issue is ongoing 'free' access to the NHS for when we return over that way. But IIRC that's tied your passport (etc) rather than any taxes/contributions made.
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Re: Advice Needed: NS liability for new PR

Postby BBCWatcher » Tue, 16 Feb 2016 3:15 pm

That all makes sense to me, PH. That AAA rated Singapore government bond you're holding that yields about 4%/year -- higher if Singapore's inflation rate ever picks up -- seems like a great deal to me, especially in a world of German, Japanese, and other long government bonds paying zero. That's what CPF is, really. CPF assets would be among the last retirement assets I would draw down if I have a choice, and I would naturally Singapore dollar cost average into pounds or euro (depending on where you retire) on a monthly basis when the time comes.

Doesn't anybody know of another AAA or even AA rated government bond that pays about 4%? CPF certainly seems like a great, fixed income part of a retirement portfolio.

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Re: Advice Needed: NS liability for new PR

Postby BBCWatcher » Tue, 16 Feb 2016 3:22 pm

JR8 wrote:Seems pretty dumb now when for example I've 2-3 years of likely worthless contributions made to the US system and a contemporaneous hole in my UK record, but that's how that particular relo-package happened to be set up.

Nope, you're (probably) in luck! The U.S. and the U.K. (and some other countries) have social security totalization treaties. You'll be able to claim a modest U.S. Social Security retirement benefit because you should have at least 6 credits in the U.S. system, the minimum when you're counting treaty country contributions. (Nontrivial contributions within any two calendar years, even separated calendar years, should easily get you at least those minimum 6 credits. In 2016 you get one U.S. Social Security credit per $1260 of taxable earned income, and that figure was lower in previous years. So, you should be fine.) When the time comes just tell the U.S. Social Security Administration about your other contributions to any/all other treaty countries, including the U.K. As long as you hit 10 years total across treaty countries you'll have a U.S. benefit. Same thing on the U.K. side -- they'll count your U.S. credits if you need them to hit the 10 year mark on the U.K. side (their minimum). Yes, you can cross-qualify that way and collect from both systems. So 2 or 3 in the U.S. and 7 or 8 in the U.K. should be enough on both sides, as an example.

On the U.S. side at least if you're legally married your spouse ordinarily would qualify for a spousal benefit. Yes, even if that spouse has never had anything to do with the U.S. Even ex-spouses sometimes qualify. U.S. annual cost of living adjustments are provided even if you live in Singapore (unlike the U.K.)

You can start collecting retirement benefits any time from age 62 up to age 70. The longer you wait, the higher your monthly benefit, but don't wait any longer than age 70. (All you're doing is missing back payments if you don't start then.) Your spouse has a different, separate decision to make on when to start but also a minimum age of 62. You can check your U.S. Social Security earnings history by visiting ssa.gov.

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Re: Advice Needed: NS liability for new PR

Postby Primrose Hill » Tue, 16 Feb 2016 3:38 pm

NI - I am paying voluntary Class 2 because it makes sense, I have spent more years contributing than not, other than the 2 years that NI "lost" my contribution. They did, like you, told me that I could cover back the loss, but the difference was GBP2.00 per week or something small.
In terms of NHS - I have no idea, JR8 when was the last time you used NHS as such but due to the medical tourism etc, 2 years ago, I walked into Moorfields with an eye problem and was subjected to the 3rd degree before being seen to by nurses and doctor. Whilst it is attached to your passport or visa, once you are away for a certain period of time, the right to NHS lapses until UK becomes your permanent residence again.
However, NHS is scary in the sense that it is such a postcode lottery. Some drugs that you need aren't on the NHS list and the equivalent aren't as good, I know because daughter has had some gastro issues and previously after we had seen the consultant we go back to the GP and have the prescription written on NHS, however, those drugs weren't available on NHS so GP recommended similar, but it didn't work as the ingredients were not similar, so went back to private prescription.
Or a friend's parent could not get the medication on NHS for her Alzeihmer's but once she returned to her home, she could, her NHS trust has them.
Such a mess the NHS

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Re: Advice Needed: NS liability for new PR

Postby JR8 » Tue, 16 Feb 2016 4:05 pm

Interesting BBCW and I'll keep that in mind for the future. But from what you outline it suggests that I'd have paid in enough to have accrued some form of US entitlement. And re: the UK I know, as best I can, that I'm paid up for that, 20/+ years contributions IIRC.
Whether or not it's worth maintaining NI payments beyond the minimum threshold... don't know. My conclusion previously was that it's probably not.
I broke my leg c4 months ago. Got a cast put on here in bongo-land then flew home and got a reliable diagnosis, x-rays, resetting the fracture (ouch!), and new cast, around last November. Yes I agree you do get a bit of 3rd-degree from reception re: eligibility, but if that reduces NHS medical tourism I'm fine with that. My answer was a) I'm temporarily abroad b) my primary home is here c) I pay UK taxes each year. End of story.
I don't know about NHS entitlement lapsing, the above was after c8 years away. The NHS is by no means perfect but it seems very good to me for covering the basic/middle range of health matters.
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Re: Advice Needed: NS liability for new PR

Postby BBCWatcher » Tue, 16 Feb 2016 4:29 pm

JR8 wrote:But from what you outline it suggests that I'd have paid in enough to have accrued some form of US entitlement.

That's good to hear! And your spouse gets a benefit too, if you have one. [If you don't have a spouse, the U.S. will pay a "signing bonus" in the form of a spousal retirement and survivors annuity. :)]

Whether or not it's worth maintaining NI payments beyond the minimum threshold... don't know.

Once you're "vested," probably not, I agree -- and especially if you'd be locked out of annual U.K. NI cost of living increases because you happen to live in the wrong country.

My wife is making voluntary contributions into a particular country's system because she isn't vested yet. We ran the numbers, and, assuming we didn't make any major mathematical mistakes, it makes a heck of a lot of sense for her to "top up" for the minimum number of years (counting treaty country years) to qualify for at least the lowest retirement benefit. But once she vests she plans to stop. This is a slight gamble because theoretically she could make mandatory contributions if she works in that country (or in another treaty country) and qualify that way, but it's a reasonable gamble to take. So voluntary contributions it is.

U.S. Social Security doesn't allow voluntary contributions, by the way. You either owe U.S. social insurance tax or you don't.

It'd be awfully nice if Singapore started signing some social security treaties, wouldn't it? Australia would be a prime candidate, in my view, since the social insurance systems are somewhat similar. Australia Medicare/Singapore MediShield Life reciprocal emergency medical coverage would be nice, too. I hope the Singapore government heads in that direction soon.


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