Uncle not paid NI wants to move abroad

athensgeorgia

My Uncle is looking at moving abroad. He is 54 atm and has enough money to manage until retirement age but after that he's not sure. He wants to know if he would be entitled to a state pension while living abroad but he's not paid any NI. He's always been self-employed and just hasn't paid any. I'm not sure how he got around it but i thought they automatically sent you a bill when you did your self assessment which i know he always has done. Can he pay the shortfall now to help him later? Btw my mums giving him 'advice' which i don't think is accurate when she retired her 'stamp' was 28p short and was advised not to pay it so she could pension credit and this is what shes teling my Uncle to do but i thought with no NI paid it'd be even worse.

Any help greatfully received.

seven-day-weekend

I don't think he can now pay enough to entitle him to a full pension, there are only a limited number of years he can backdate.

If he was in the UK he would be eligible for Pension Credit at his State Retirement age. However, this document confirms that Pension Credit (Income Support for people who don't have a Pension) is not payable if you move abroad permanently.

http://209.85.229.132/search?q=cache:-vgQVih_ZnkJ:www.jobcentreplus.gov.uk/JCP/stellent/groups/jcp/documents/websitecontent/dev_012307.pdf+pension+credit+abroad&hl=en&ct=clnk&cd=2&gl=uk

However, he may be able to pay Voluntary Contributions from now until he is 65 (which will give him about 10 or 11 years, depending upon the tax years) and if he can buy some backdated ones too it may entitle him to a reduced State Pension.

If he is working abroad, he can pay into the Social Security of that country, but whether that will entitle him to a pension or not depends upon their rules; I know some countries you have to pay in for twenty years before you are entitled to anything.

I'm not a Pensions professional, so if I'm wrong someone will correct me.

I don't understand your mum's 'advice' so can't help there, I'm afraid.

EdInvestor

He should speak to the Pension Service about his options.

www.thepensionservice.gov.uk

Employed xpats are able to pay class 2 (self employed) NI, which are very cheap. He might be able to pay 10 back years, but it could be complicated as tax comes into the picture as well ( did he ever do any accounts for whatever work he did)?.

He is 54 atm and has enough money to manage until retirement age but after that he's not sure.

It looks to me that he will need to regard these savings as for his retirement, not for living on now, and go back to work.

margaretclare

I just can't imagine how someone has been self-employed up to age 54 and had never paid any NI.

Does that mean he's never paid any tax either????

seven-day-weekend

I don't understand it either MargaretClare (neither does the OP if you read her post). She says he has done his self-assessment, so maybe he assessed himself as earning little enough to be able to apply for NI exemption, which you can do if you are self-employed and don't earn much.

I suppose we'll never know!

Cook_County

Maybe he has just frauduently evaded Class 2 but paid only the Class 4 tax charge.

He may be able to backdate a few years quite inexpensively now if he does it soon; but of course he could find himself prosecuted if he evaded paying.

Where is he going to live?

athensgeorgia

Its all very confusing, He wants to move to Thailand to be with his 'girlfriend'. The money he was planning on living on is from the sale of his house. The only reason i know he's completed tax returns is by helping him organise his paperwork for his recent divorce where he had to provide his earnings and i delivered some paperwork to his accountant so i do know he does accounts that why i was confused re: no NI paid. He's always been a self employed builder/roofer so not sure if the building trade pay tax/NI differently. He's still working atm but has recently had a heart attack and has bad days where he can't go up on a roof and i think with the new girlfriend living in Thailand thats why he was planning an early retirement. I did tell him what was said initially and i had already told him about ringing the pensions service but i think he's going to try and perservere a bit longer with work.

Thanks for the help everyone.

jancee_2

I wonder if he has been paying NI without realising? His accountant should have pointed out if he wasn't. It's not a huge bill so perhaps he left it to the accountant to sort out for him?

He should get a state pension forecast which would tell him whether he has or not.