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Graduated Retirement Benefit (GRB) explained

Last updated 19th December 2024
4 min read

Graduated Retirement Benefit tops up your basic State Pension. You're entitled to receive graduated pension payments if you worked for an employer and paid graduated contributions between 1961 and 1975. (More on this below).

This guide explains what you need to know about the scheme and the payments you’ll receive. It covers:

  • What Graduated Retirement Benefit is
  • Who is eligible for Graduated Retirement Benefit
  • Graduated Retirement Benefit rates
  • Tax considerations with Graduated Retirement Benefit
  • Other frequently asked questions

What is Graduated Retirement Benefit?

Graduated Retirement Benefit is an extra State Pension payment that tops up your basic pension. You should receive it if you paid graduated contributions on your earnings between 1961 and 1975 as part of the graduated pension scheme.

It was introduced by the National Insurance Act 1959. This was the first State scheme to offer earnings-related pension payments on top of the basic State Pension.

Graduated Retirement Benefit was replaced by the State Earnings Related Pension Scheme (SERPS)(uk.practicallaw.thomsonreuters.com opens in a new tab) in 1978.

Who is eligible for a graduated pension?

You're eligible for graduated pension payments if you paid graduated contributions between April 1961 and April 1975. Not sure if this applies to you? You'll have paid graduated contributions if you were any of the following during this period:

  • Over 18
  • Worked for an employer and paid Income Tax and NI
  • Earned over £9 a week at that time

How to claim your graduated pension

There’s nothing in particular you need to do to claim your graduated pension payments. Once you reach State Pension age and claim your payments, you should automatically receive Graduated Retirement Benefit. It will be an add-on to your basic pension (if you’re eligible).

How is a graduated pension paid?

Your graduated pension makes up a small proportion of your State Pension. It's paid in lump sums rather than as part of your weekly payments.

Can’t find Graduated Retirement Benefit in your pension statements? Don’t worry. The payments are in the extra 'State Pension estimate' part of your statements. (You won’t find the amount shown separately.)

How much is Graduated Retirement Benefit?

The amount of Graduated Retirement Benefit you receive is based on how much you paid in graduated contributions.

First, the government works out your total graduated contributions. Then the amount of graduate contribution you paid is divided by:

  • 7.5 for men
  • 9 for women who reached State Pension age before 6th April 2010
  • 7.5 for women reaching State Pension age on or after 6th April 2010

Men can have up to 86 units, whilst women can have up to 72. The difference is based on the fact that State Pension ages used to be different for men and women.

The cash value of these units is based on the unit price, which goes up each year. The current unit price for 2024-2025(www.gov.uk opens in a new tab) is just over 16p per week for each unit.

For example, if your contribution equates to 70 units, your Graduated Retirement Benefit would top up your pension by £11.50 per week.  

Increases in graduated pensions

The graduated pension unit price goes up each year. You can check the current year’s pension rates on the gov.uk(www.gov.uk opens in a new tab) website.

Other graduated pension FAQs

We’ve looked at the main issues surrounding Graduated Retirement Benefit. Here are answers to some other common questions:

Is Graduated Retirement Benefit taxable?

Yes. Your State Pension counts as taxable income. This includes any graduated pension payments you receive. If your State Pension payments push you over your taxable allowance, you will have to pay Income Tax(www.gov.uk opens in a new tab).

Can Graduated Retirement Benefit be inherited?

Yes. You can inherit 50% of the Graduated Retirement Benefit that your spouse or civil partner qualified for. This only applies if either you or your former partner reached the State Pension age before the 6th April 2016, and you did not remarry or enter a new civil partnership before this point.

Contact the Pension Service(www.gov.uk opens in a new tab) to find out what you can claim and how.

When did the graduated pension scheme start and end?

The graduated pension scheme tops up the pensions of those who paid graduated contributions from April 1961 to April 1975.

Read on

If you found this guide useful, you may want to read some of our other articles on money, pensions, and retirement:

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The thoughts and opinions expressed in the page are those of the authors, intended to be informative, and do not necessarily reflect the official policy or position of SunLife. See our Terms of Use for more info.