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

COPE stands for Contracted Out Pension Equivalent.

If you were employed before 2016 your employer may have chosen to “contract out” part of the National Insurance (NI) they paid that entitles you to your State Pension. Until 2012, contracting out was also possible through some types of personal pensions.

This meant that either you and your employer paid NI at a lower rate, or some of your own NI contributions were invested into your private pension instead of the State Pension.

This used to be quite common. The old State Pension was split into two parts. Being contracted out meant that while you were building entitlement towards your basic State Pension, what would have been your Additional State Pension entitlement was building up within your private pension.

At the time you were contracted out, the Additional State Pension could have been called something different including:

• Graduated retirement benefit
• SERPS (State Earnings Related Pension Scheme)
• State Second Pension (S2P).

If you were contracted out, this might reduce how much you would get from your State Pension, compared to someone in similar circumstances who was not contracted out. However, the important thing to know is that this isn’t money you’ve completely lost out on, the amount you are entitled to will have been building up elsewhere, and you can still claim it.

While you were contracted out, money was paid into your pension on your behalf that should cover what you would have received if you were entitled to Additional State Pension. This is your COPE amount. How much you might get exactly would depend on the type of pension that was used to contract out.

You can ask your pension provider for a forecast of your contracted out pension benefits.

You can no longer see estimated COPE figures your State Pension forecastOpens in a new window – it will just tell you that you were contracted out of part of the State Pension.

No, your COPE amount won’t be deducted from your State Pension. The amount shown on your State Pension forecastOpens in a new window still stands. But, this could include years of National Insurance (NI) contributions you haven’t made yet.

Follow the steps in the next section to claim the part of your pension that was contracted-out. The COPE amount included in your State Pension forecast is just an estimate. Depending on the type of pension scheme that was used to contract out, it could be worth more or less than what it shows.

If you were contracted out, this would have been done through a private pension. Either this would have been set up as a new pension, or you might already have the COPE amount included as part of your workplace pension. Even if you’ve changed jobs a lot or lost the details of old pensions, you can still claim this money.

If you already know all your pension providers, you can get in touch to ask about your COPE amount. They will be able to tell you if you were contracted out or not, and how much that money is worth now.

Some pension providers might call it your “Guaranteed Minimum Pension” (GMP).

If you’ve been told you have a COPE estimate but aren’t sure where it could be from, it might be from a pension you’ve forgotten about or lost access to.

HMRC can tell you when you were contracted out if you get in touch with their National Insurance helpline.

You can also request your employment history from HMRCOpens in a new window if you’re not sure where you worked and the dates you worked there.

See step-by-step help in our article How to find old or lost pensions.

For some, their COPE amount would have been paid into a defined contribution (DC) pension. This is a pot of money for you to decide what to do with once you’re over 55 years old.

This means that the actual pension amount you might get will depend on factors such as investment performance, fees you are charged, and the choices you make when you decide to access the pot.

It’s different from a defined benefit (DB) pension, which you might know as a ‘final salary’ pension where you get an income for life, instead.

You can find out more about your pension choices in our tool Explore your pension options.

If you’re 50 or over with a UK defined contribution pension, you can also have a free Pension Wise appointment to understand the different ways you can take your pension. 

If you were in a contracted-out defined benefit (DB) scheme, you and your employer paid a slightly lower rate of National Insurance contributions. This is because neither you nor your employer contributed to the Additional State Pension.

If you were contracted out through a DB pension, the scheme would have to provide a minimum benefit known as 'Guaranteed Minimum Pension' (GMP), in place of the additional pension you were giving up.

If you were contracted out for a large portion of your working life, it might affect the amount of State Pension you’re entitled to. National Insurance (NI) contributions are made when you pay in by working, or can be earned through claiming certain benefits, including Child Benefit. If you were contracted out, you might need more qualifying years to get the most out of the State Pension.

Learn more about National Insurance creditsOpens in a new window on GOV.UK.

When there are gaps in your NI record, and you don’t already have the number of qualifying years that would entitle you to a full State Pension, it could be worth paying for Voluntary National Insurance contributions.

For step-by-step help, see our guide Increase your State Pension with voluntary National Insurance contributions.