There follows a brief description of the types of pensions and payments covered elsewhere on the page. It is not an authoritative statement on armed forces pensions and payments, but an outline of them.
Your armed forces pensions and payments affect benefits in different ways, depending on why and when they were awarded. HM Revenue and Customs (who decide and pay tax credit awards), the DWP (who decide and pay social security benefits) and local authorities (who decide and pay housing benefit) may not always accurately identify what pensions or payments you are getting or treat them correctly.
You should disclose all pensions, payments, and capital you receive when claiming benefits and tax credits. Seek expert advice if in doubt about whether you are getting your full benefit entitlement.
There are several pension schemes for people who have served in the British armed forces. These include pensions similar to occupational pensions paid when people retire from their job. They are usually based on your length of service, and your rank and pay. They include the 1975, 2005, 2015 armed forces pension schemes and the reserve forces scheme.1 Here, we refer to these as the 'armed forces pension schemes' (AFPS). They are administered by Veterans UK on behalf of the Ministry of Defence.
AFPS pensions are normally taken into account in full as income when working out how much means-tested benefit you can get. This is similar to the treatment of civilian 'occupational' or work pensions.
If you die while still serving in the armed forces, your spouse, civil partner (or in some cases a surviving cohabiting partner) may get a (taxable) pension and a tax-free lump sum. These payments are usually referred to as 'survivor pensions' or 'dependant’s benefits'. Here, we use the term 'survivor pensions'.
In contrast with war widow(er)'s pensions (see below), these survivor pensions can be paid regardless of whether death was a result of your service.
It is possible for your surviving spouse or partner to get both a survivor pension and a war widow(er)'s pension at the same time. This could happen if you die whilst in service, and as a result of your service. These survivor pensions are normally taken into account in full as income when working out how much means-tested benefit you can get.
The rules on whether your surviving spouse or partner can get a 'survivor pension', and the amount paid, depend on which AFPS scheme you were in (AFPS 75, 05 or 15) as well as your circumstances at the time of your death (rank, length of service and other factors).2
You might get a payment because of injury, illness or disability resulting from your service, or because your spouse or partner died as a result of their service. The type of payment you get depends on the date the injury or death happened.
If injury, illness, disability, or death is caused during service before 6 April 2005 and can be attributed to (in other words, was caused or made worse by) your service, and you have left the armed forces, you can be compensated under the War Pensions Scheme (WPS). This applies even if you left the armed forces on or after 6 April 2005. If your spouse, or an eligible partner died as a result of service before 6 April 2005, you might qualify for a war widow(er)’s pension.
There are two main types of war pension awards:3
If you get a war pension, you may also get additional payments, called supplementary or additional allowances.4 Some of these additional allowances 'overlap' with one another and with certain social security benefits. This means that you cannot get both the supplement and the benefit at the same time or get both paid in full.
The following shows which supplements overlap with which social security benefits. (There is a full list of war pension allowances/supplements, and information about them on GOV.UK.) If you meet the qualifying conditions for both the allowance/supplement and the benefit, you should seek advice on which ones to claim.
You can read about allowance for a lowered standard of occupation (ALSO) on gov.uk. It overlaps with:
The rule about overlapping may not apply to you if you have been getting ALSO continuously since before 6 April 2009. This is because the rule was introduced from that date.5
Constant attendance allowance (CAA) overlaps with:6
Unemployability supplement (UnSupp) overlaps with:7
War pensioners mobility supplement (WPMS) overlaps with:8
War widow(er)'s pension is paid to a surviving spouse or civil partner, and in some cases, to a surviving cohabiting partner.9 In contrast with AFPS survivor pensions (above), they are paid only where death resulted from service. The rate at which your war widow(er)'s pension is paid depends on your age, whether you have children, and the rank of your spouse or partner when they died and whether you get certain other social security benefits.10 You may be able to get additional allowances- for example, for children or for your rent.11 War pension, war widow(er)’s pension and the supplementary/additional allowances are tax free.12
If you were injured or became ill as a result of your service between 31 March 1973 and 5 April 2005, and were medically discharged as a result, you may get a payment under the Armed Forces Attributable Benefits Scheme (AFAB).13 This type of payment is usually referred to as a 'service attributable pension' or 'SAP'.14 It is tax free.15 This can be paid on top of a war pension. If your spouse's or civil partner's death resulted from their service during this period, you might also get a payment under this scheme.
If you were discharged from the armed forces for medical reasons and the injury or illness responsible for your medical discharge was not attributable to your service, you may get a tax-free lump sum and an immediate pension. This pension may be described as a 'non attributable' pension or a 'Service Invaliding Pension' (SIP). The amount you get is based, among other things, on your length of service, and is taxable. A decision may be made later that your injury or illness was caused by your service. This can mean that your SIP is no longer taxable. Such pensions are sometimes referred to as 'non-taxable attributable service invaliding pensions'.16
The Armed Forces Compensation Scheme (AFCS) replaced both the War Pension Scheme and the AFAB scheme from 2005. If injury, illness or death is caused by service on or after 6 April 2005, compensation can be paid to you (or your widow/widower/surviving civil partner or child in the event of your death) under the AFCS.17
There are two main components of an AFCS award:
It is not necessary for you to have left the armed forces for you to get an award.
If you get a GIP at the rate of 50 per cent or more, you may be eligible for armed forces independence payment (AFIP), an award for serving or former service personnel who have been seriously injured as a result of service. This is paid at the same rate as the enhanced rate of both components of personal independence payment. AFIP is intended to help with the extra costs resulting from disability. It is administered by Veterans UK but paid by the DWP.
The difference in the way that armed forces pensions and payments are treated for universal credit (UC) and the benefits it replaced ('legacy benefits') can mean that veterans and their families are much worse off on those legacy benefits or pension credit. Getting a benefit check can ensure you are getting the right amounts. This is particularly important if you are nearing state pension age.
The lump sum gratuity paid with war disablement pension, and the lump sums paid with AFCS should be treated as personal injury payments. They are ignored when working out your benefit, for a period of 12 months. If paid into a trust, they can be disregarded indefinitely. Lump sums taken out of the trust may be treated as capital and are no longer ignored.19
Your AFPS pension counts in full as income for UC, as does any taxable non-attributable service invaliding pension you get.
War pension and its various supplements – none of which are taxable are ignored in full as income for UC.20 This also applies to tax-free invaliding pensions and attributable pensions paid under the armed forces attributable benefits (AFAB) scheme.21
This does not mean that you will always find yourself better off claiming UC than the benefits which UC replaces. For example, if you get a war pension and you claim UC, you are not treated as though you have limited capability for work (or limited capability for work-related activity). You may be expected to take part in work-related activity (at the discretion of your work coach at the jobcentre) until a work capability assessment is arranged for you. This is the case whether you are single or a member of a couple. You might not pass the work capability assessment, although you can challenge a decision you do not agree with. Seek advice about your own situation before making a claim.
War widow’s and widower’s pensions are not taken into account as income for UC. If you get one of these pensions, you are exempt from the benefit cap.22 The benefit cap can reduce the amount of UC you get, so if you’ve had a benefit reduced because the benefit cap was wrongly applied to you, or you have now started getting one of these payments, you should get advice on how this might affect your UC.23
A GIP, whether for you or for a survivor, is disregarded as income for UC.24 SAPs and attributable SIPs, both of which are tax-free, are also disregarded in full.25
Armed forces independence payment (AFIP) is disregarded as income for UC.
Veterans have drawn attention to a problem when deciding whether to claim UC if they get UnSupp. On the one hand, UnSupp is not taken into account as income for UC as it is with most other means-tested benefits. On the other, you are not usually treated as having limited capability for work or limited capability for work related activity when you first claim, just because you get UnSupp. Instead, you may be asked to attend a work capability assessment and provide fit notes.26
Veterans are concerned in case a decision that they do not have limited capability for work could affect their entitlement to UnSupp. Seek advice from one of the organisations listed at the end of this factsheet if you have concerns about this.
Most people cannot make a new claim for one of these means-tested benefits. If you stop being entitled to one means-tested benefit, you do not necessarily stop being entitled to another one. For example, if your income increases, you might lose entitlement to income-related employment and support allowance (ir ESA). You could still be entitled to housing benefit (HB), however. People are sometimes wrongly told that they must claim universal credit (UC) in this situation. You should seek expert advice as soon as possible before claiming UC, as you may have other options.
The lump sum gratuity paid with war disablement pension, and the lump sums paid with AFCS pensions should be treated as personal injury payments and ignored.27
For ir ESA, income support and income-based jobseeker's allowance, war pension, war widow’s and widower’s pensions are taken into account as income, but £10 a week of these payments is ignored.28 Getting one of these pensions means you are exempt from the benefit cap.29 The benefit cap can reduce the amount of HB you get.30 If your benefit was reduced because the benefit cap was wrongly applied to you, or you have now started getting one of these payments, you should get advice on how this might affect your HB.
For HB, local authorities can ignore more than £10, and many ignore all such payments.31 They have the discretion to ignore the various supplements and allowances paid with war pensions and war widow’s/widower’s pensions, and not just the pension itself.32
Constant attendance allowance, exceptionally severe disablement allowance, severe disablement occupational allowance and war pension mobility supplement (supplements paid with war pensions) are not taken into account as income for any of these benefits.33
AFCS GIPs are treated in the same way as war pensions for income related benefit purposes: £10 a week is ignored but any more than this counts as income.34 For housing benefit, local authorities have the discretion to ignore all of your GIP/survivor’s GIP.35
Getting a GIP, or a survivor’s guaranteed income payment (for yourself or a child of the deceased) also means you are exempt from the benefit cap.36
Taxable, non-attributable SIPs are taken into account in full as income.
Most people cannot make a new claim for tax credits. If you are already getting child tax credit (CTC), however, you can start getting working tax credit (WTC) and vice versa.
Lump sum payments under the AFPS, the war pension scheme or the AFCS - all of which are capital - do not affect your tax credits unless (together with any other savings you have) they result in payment of interest.37
Your AFPS pension payments and any taxable service invaliding payment are taken into account in full as income for tax credits.38 Tax-free attributable pensions are ignored.39 If you get a service invaliding pension which is later ruled to be attributable to your service, seek expert advice about the impact on your tax credits and benefits.
War pensions and war widow’s/widower’s pensions are ignored as income.40
Constant attendance allowance and war pension mobility supplement - two of the allowances which can be paid with the war pension - are not taken into account as income.41
A GIP paid to a veteran does not count as income for tax credits, but a GIP paid to a survivor and payments for children under the AFCS are taxable and will count as income (subject to the £300 a year disregard in respect of pension payments).42
Your AFPS pension is taken into account in full as income for pension credit.
War pension, war widow’s and widower’s pensions are taken into account as income, but up to £10 a week of these payments is ignored.43 Constant attendance allowance, exceptionally severe disablement allowance and war pension mobility allowance (supplements paid with war pensions) are not taken into account as income, however.44
Up to £10 of any Guaranteed Income Payment (GIP) or survivor’s GIP you get can be disregarded as income for pension credit.45
The lump sum payment with a war pension or GIP is treated as capital but should be disregarded on the basis that it is compensation for personal injury. This does not apply to lump sums paid to you as a widow/widower/survivor, however, since the compensation is not in respect of a personal injury to you.46
CPAG gives advice to frontline advisers and support workers. This page also gives details of how to find advice about your own situation.
0800 085 3600
These are referred to respectively as AFPS 75, AFPS 05 and AFPS 15. See House of Commons Library, Support for UK Veterans, CBP7693, 2023
Ministry of Defence, Armed Forces Pension Scheme 1975 Family Benefits, MMP114, 2015; Ministry of Defence, Armed Forces Pension Scheme 2005 Your Pension Scheme Explained, 2005, Section 7; Ministry of Defence, Armed Forces Pension Scheme 2015 Your Pension Scheme Explained, 2023, Section 7
Reg 6 Social Security (Overlapping Benefits) Regulations 1979 No.597
Regs 2(1) (definition of 'unemployability supplement'), 6 and Sch 1 Social Security (Overlapping Benefits) Regulations 1979 No.597; reg 16(6) Carer’s Assistance (Carer Support Payment) (Scotland) Regulations 2023 No.302
Reg 6 Social Security (Overlapping Benefits) Regulations 1979 No.597; Reg 34 Disability Assistance for Working Age People (Scotland) Regulations 2022 No.54; Reg 23(6) Disability Assistance for Children and Young People (Scotland) Regulations 2021 No.174
arts 23 and 24, Naval, Military and Air Forces Etc. (Disablement and Death) Service Pensions Order 2006 No. 606
Sch 2, Army Pensions (Armed Forces Pension Scheme 1975 and Attributable Benefits Scheme) Warrant 2010 as amended; Naval and Marine Pensions (Armed forces Pension Scheme 1975 and Attributable Benefits Scheme) Order 2010 as amended; Air Force (Armed forces Pension Scheme 1975 and Attributable Benefits Scheme) Order 2010, as amended
Payments under the war pensions scheme are also sometimes referred to as 'attributable' since they are attributable to your service. However, we use the term 'SAP' to refer only to payments under the armed forces attributable benefits (AFAB) scheme. It’s possible for a condition or injury to be found caused or worsened by your service under the war pensions scheme but not 'attributable' under AFAB.
See R(IS) 3/99 for an example
Introduced by the Armed Forces (Pensions and Compensation) Act 2004. Detailed rules in The Armed Forces and Reserve Forces (Compensation Scheme) Order 2011 No.517.
Arts 15(1) and 24 Armed Forces and Reserve Forces (Compensation Scheme) Order 2011 No.517
Reg 75(1),(4) and (5) Universal Credit Regulations 2013 No.376; DWP, Advice for Decision Making, para H2028
Regs 66(1)(a) and 67 Universal Credit Regulations 2013 No.376; s16(1)(f) and (l) State Pension Credit Act 2002
None of these pensions meet the definition of a pension under UC rules: Reg 67 Universal Credit Regulations 2013 No.376 and s16 State Pension Credit Act 2002. See also the note to DWP, Advice for Decision Making, para H5010.
In Scotland you should be able to get a discretionary housing payment to make up for this shortfall.
Neither a GIP nor an attributable pension meets the definition of a pension under UC rules: Reg 67 Universal Credit Regulations 2013 No.376 and s16 State Pension Credit Act 2002. The AFCS is a Public Service Pension: Public Services Pensions Act 2013
See the note to DWP, Advice for Decision Making, para H5010.
In the case of severely disabled veterans discharged because of their condition and claiming UC immediately upon leaving the armed forces, the DWP are now using evidence in military medical records, rather than calling the veteran in for a face-to-face assessment: House of Commons Library, Support for UK Veterans, CBP7693, 2023, p67
Sch 9 para 16 Income Support (General) Regulations 1987 No.1967; Sch 7 para 17 Jobseeker's Allowance Regulations 1996 No.207; Sch 8 para 17 Employment and Support Allowance Regulations 2008 No.794
In Scotland you should be able to get a discretionary housing payment to make up for this shortfall.
Sch 5 para 15 Housing Benefit Regulations 2006 No.213; Sch 5 para 1(b) and (c) Housing Benefit (State Pension Credit) Regulations 2006 No.214 ; Sch, Parts 1 and 2, Housing Benefit and Council Tax Benefit (War Pensions Disregard) Regulations 2007 No.1619
Sch 9 paras 8 and 9 Income Support (General) Regulations 1987 No.1967; Sch 7 paras 9 and 10 Jobseeker's Allowance Regulations 1996 No.207; Sch 8 paras 10 and 11 Employment and Support Allowance Regulations 2008 No.794; Sch 5 paras 8 and 9 Housing Benefit Regulations 2006 No.213; reg 33(9) and Sch 5 para 1 Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations 2006 No.214
Sch 9 para 16 Income Support (General) Regulations 1987 No.1967; Sch 7 para 17 Jobseeker's Allowance Regulations 1996 No.207; Sch 8 para 17 Employment and Support Allowance Regulations 2008 No.794; Sch 5 para 15 Housing Benefit Regulations 2006 No.213; reg 33(9) and Sch 5 paras 2 and 3 Housing Benefit (Persons who have attained the qualifying age for state pension credit) Regulations 2006 No.214; Sch Part 2, Housing Benefit and Council Tax Benefit (War Pensions Disregard) Regulations 2007 No.1619
Reg 10 Tax Credits (Definition and Calculation of Income) Regulations 2002 No.2006
Reg 5(1) Tax Credits (Definition and Calculation of Income) Regulations 2002 No.2006
Reg 5(2) Table 2 para 1 Tax Credits (Definition and Calculation of Income) Regulations 2002 No.2006
Reg 5(2) Table 2 paras 1, 3, and 4 Tax Credits (Definition and Calculation of Income) Regulations 2002 No.2006HMRC, Tax Credits Technical Manual, para 04303 ; ss639 and 640 Income Tax (Earnings and Pensions Act 2003; War widow’s and widower’s pensions are paid under Part III of the Naval, Military and Air Forces etc. (Disablement and Death) Service Pensions Order 2006 No.606, for death due to service before 6 April 2005. See also House of Commons Library, War Widows' Pensions, CBP 00568, 2023, pp4-5.
Reg 5(1)(b) Tax Credits (Definition and Calculation of Income) Regulations 2002 No. 2006; HMRC, Employment Income Manual, para 74306
Reg 17 (7) and Sch 4, para 1 State Pension Credit Regulations 2002 No.1792
Reg 17(7) and Sch 4 para 2-4 State Pension Credit Regulations 2002 No.1792
Sch 4, para 1 State Pension Credit Regulations 2002 No.1792; DWP, Decision Makers' Guide, para 85200 onward and Appendix 1 to Chapter 85
Reg 17(8) and Sch 5 para 16(1) State Pension Credit Regulations 2002 No.1792; R(SB) 2/89; R(IS) 3/03
