What is COPE and how does it affect my State Pension?

How much State Pension you get depends on the number of qualifying years of National Insurance (NI) you’ve built up. These usually come from paid contributions through working or credits if you’re looking for work or unable to.

You usually need at least 35 qualifying years to qualify for the full amount, but you might need more if you were contracted out before April 2016.

This is because some of your NI contribution went towards your private pension instead, so you would have paid less NI than someone who had not contracted out.

COPE is the amount of pension benefits you would have received from the Additional State Pension if you had not contracted out.

Before April 2016, the State Pension was split into two parts:

• Basic State Pension
• Additional State Pension, sometimes called:
  • State Earnings Related Pension Scheme (SERPS)
  • State Second Pension (S2P)

One option was to contract out of the Additional State Pension, so your National Insurance contributions would build up in your private pension instead.

You can check your State Pension forecastOpens in a new window on GOV.UK to see if you’ve been in a contracted-out pension scheme. You’ll also see how much State Pension you’re on track to get and the number of qualifying years you still need to get the full amount.

You can also:

• call the HMRC National Insurance helplineOpens in a new window
• check your payslips from before April 2016 for your NI category letter – D, E, L, N or O show you were contracted out.

If your State Pension forecast shows you’re expected to get the full amount anyway, you do not need to do anything. For example, if you need 15 more qualifying years but you’re expecting to work or receive benefits for that period anyway.

If it shows you’re not likely to get the full amount, you might be able to boost the amount you get by claiming free NI credits or paying to fill gaps in your record. Your forecast should explain your options.

For more information, see our guide Increase your State Pension with voluntary National Insurance contributions.

While you were contracted out, some of your NI contribution should have been building up in your private pension, either:

• a workplace pension that your employer set up
• an appropriate personal pension – this was possible until April 2012.

How this worked depends on the type of pension you have. You can use our tool to find out your pension type or ask your provider.

If you’re not sure which pension the money went to, you can trace it for free. For step-by-step help, see our guide How to find old or lost pensions.

If your contracted out amount went into a defined contribution pension, the money would have been invested along with all the other money paid in.

This means it could benefit from investment growth and you can choose how and when you’d like to take it. For more information on all your options, see our guide What can I do with my pension pot?

If you were in a contracted-out defined benefit pension (often called a final salary or career average scheme), you and your employer paid a lower rate of National Insurance contributions. This is because no contributions were made to the Additional State Pension.

Your scheme also had to provide guaranteed pension benefits that were equal to, or better than, the Additional State Pension.

For example, if you were contracted out between 6 April 1978 and 5 April 1997, you’ll have a Guaranteed Minimum Pension (GMP). This should be worth at least the amount you would have got in Additional State Pension.