Deferred state pension lump sum

What are the rules regarding taxation of the lump sum payment option when I claim my deferred pension?

Hi,

You can get a one-off lump sum payment if you defer claiming your State Pension for at least 12 months in a row. This will include interest of 2% above the Bank of England base rate.

You’ll be taxed at your current rate on your lump sum payment. For example, if you’re a basic rate taxpayer your lump sum will be taxed at 20%.
You can find out more here:

Delay (defer) your State Pension

Thank you.

Thank you

Hi HMRC Admin 32 Response, all research I have done states lump sum only available to those who reach SPA on or before 5/4/2016. But I have evidence that shows that a lump sum is paid for an individual who reached SPA in 2023. Can you clarify the original rule and any change that may have occurred that allows the lump sum payment as well as the accrued state pension weekly payments? Thank you.

Hi Advisor AJN,
I am afraid HMRC cannot advise on the rules for claiming state pension. This question will need to be directed to the DWP.
Department for Work and Pensions - GOV.UK
Thank you.