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    • aroominyork
    • By aroominyork 10th Oct 16, 10:14 PM
    • 34Posts
    • 5Thanks
    Buying extra NI years from before migrating to the UK
    • #1
    • 10th Oct 16, 10:14 PM
    Buying extra NI years from before migrating to the UK 10th Oct 16 at 10:14 PM
    My wife came to the UK from Australia in 2001. The site says she has 16 years of full NI contributions and by 2023, when she can retire, she will have 23 years. Baed on this she will receive £116.74 pw pension. I have two questions. 1) Since £155.65 x 23/35 = £102.28 why is she entitled to a higher amount? 2) Can she buy additional years so that she receives a full state pension, given that those additional years might be seen to relate to before she moved to the UK?
    Last edited by aroominyork; 10-10-2016 at 10:18 PM.
Page 1
    • colsten
    • By colsten 10th Oct 16, 11:00 PM
    • 8,027 Posts
    • 6,518 Thanks
    • #2
    • 10th Oct 16, 11:00 PM
    • #2
    • 10th Oct 16, 11:00 PM
    I don't know the answer to your Q1. For Q2, use this guide:
  • jamesd
    • #3
    • 11th Oct 16, 12:19 AM
    • #3
    • 11th Oct 16, 12:19 AM
    The state pension rules covering accrual before 6 April 2016 had two portions:

    A. Basic state pension. 1/30th of the BSP per year of paying in or getting credits. No way to opt out of this, you always get it.
    B. Additional state pension. Earnings-related and even if you contracted out under the S2P system that replaced SERPs you got some ASP. No cap on number of years paying in, work from 16 to a state pension age of say 65 and you'd be accumulating for 49 years. This one is why a low earner for a long working life under this old system could get around £190 a week of state pension.

    From 6 April 2016's contribution year each person gets a foundation amount which is the higher of the old rules and new rules calculations. Then from the 2016/17 tax year onwards future accruals are at 1/35th of the flat rate amount per year of paying in or getting credits, capped at the flat rate level of about £155 a week. No earnings-related portion. If foundation amount entitlement is above the flat rate level the part above doesn't get the triple lock, just CPI increases.

    So the answer to question 1 is that she was working, not getting credits for receiving child benefit, being unemployed and searching for work or whatever else. Enough so that the earnings-related portion took her above the flat rate level's calculation for the same number of years. So she got the higher old rules calculation.

    If she has any years that aren't full from 2006 onwards she may be able to buy them. It's too late to buy earlier years than that. Her online state pension statement will say which years she can buy, if any. Probably none given her current situation.

    The 16 years will not include 2015/16 yet. So that means she really has 17 years so far and would actually be entitled to a little more than she's told at the moment.

    The £116.74 would include 7 years of accrual at 1/35 of £155.65 per year (sort of, one of those is really the non-flat rate 2016/17 year but I'll pretend it's flat rate). 7/35 * 155.65 = 31.13 so that implies that her current entitlement is £85.61. That's about 5.35 a week over 16 years on average. Which is above the flat rate accrual rate of 4.44 a year. So she got the higher old rules calculation with earnings-related part instead as her foundation amount. If her earnings didn't change that implies that she'll actually get around 90p a week more than the 116.74 since the earnings-related part of 201516 isn't included yet.
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