Shortfall in National Insurance Contributions

GillyFlower

Are there any women out there feeling something is not fair?

1. I was able to retire in 2005 (aged 60) but deferred my Pension until 2007.

2. I paid a full stamp throughout my working life.

3. I got the Home Responsibilities Protection, for those looking after children, from 1978 onwards. It was just after that period I started work and remained until retirement age.

BUT -

I am not able to get the full pension or even make up any shortfall because the law did not change until 1978.

So I am not entitled to a full pension. My husband has just retired and it would make no difference to my pension to claim from him because I am already receiving more than the 60%? state pension rate.

SO -

Is there a group of woman who are not able to get that full pension and feel the law has changed for many others but we have slipped through the net?

jancee_2

GillyFB wrote: »

Are there any women out there feeling something is not fair?

1. I was able to retire in 2005 (aged 60) but deferred my Pension until 2007.

2. I paid a full stamp throughout my working life.

3. I got the Home Responsibilities Protection, for those looking after children, from 1978 onwards. It was just after that period I started work and remained until retirement age.

BUT -

I am not able to get the full pension or even make up any shortfall because the law did not change until 1978.

So I am not entitled to a full pension. My husband has just retired and it would make no difference to my pension to claim from him because I am already receiving more than the 60%? state pension rate.

SO -

Is there a group of woman who are not able to get that full pension and feel the law has changed for many others but we have slipped through the net?

Well, I do see your point in that if the 30 year rule had been in place you would have had a higher pension but the roundabout to that swing is that you wouldn't have been able to claim it at age 60. And if you haven't got a full pension it's because you didn't have the 39 years required.

Women born just after 5 April 1950 get the best deal - they don't have to wait much past age 60 to claim and yet they only need the 30 years. Women born after April 1955 need to wait until they are 65 to claim. Potentially they will be missing out on £20,000 upwards - that's one way of looking at it.

GillyFlower

Hi Jancee

Thank you for giving me another side to the story.

seven-day-weekend

jancee wrote: »

Well, I do see your point in that if the 30 year rule had been in place you would have had a higher pension but the roundabout to that swing is that you wouldn't have been able to claim it at age 60. And if you haven't got a full pension it's because you didn't have the 39 years required.

Women born just after 5 April 1950 get the best deal - they don't have to wait much past age 60 to claim and yet they only need the 30 years. Women born after April 1955 need to wait until they are 65 to claim. Potentially they will be missing out on £20,000 upwards - that's one way of looking at it.

I'm the opposite side of the deadline - born in January 1950 - so still needed the 39 years (made up of 24 years paid through work, 13 years of HRP and two years of Voluntary Contributions). I can claim at 60. Another lady who I know was born in May 1950, only had 31 years, didn't bother to pay any voluntary contributions and can now get her full Pension at 60 and one month.

Still, they have to make a cut-off point somewhere, so I just did what was necessary and paid the two years.

It has worked well for my husband who was eight years short when he took early retirement - we were going to start paying his voluntary contributions after we'd finished paying mine - but with the change in the law he already has more than enough as his retirement date is 2014 so that has saved us a lot of money.

As you say, swings and roundabouts.

fiftyeighter_2

seven-day-weekend wrote: »

If you have paid or been credited with enough full contributions his age will not affect your entitlement.

Get a Pension Forecast here:


http://www.thepensionservice.gov.uk/state-pension/forecast/home.asp

It will tell you what your entitlement is.

Thanks so much for that. I have been told I have 27 tears of contributions. so hopefully i will be ok. I was born in may 1950 so i appear to be one of the lucky ones. Hope everyone has a good day.

SnowMan

fiftyeighter wrote: »

Thanks so much for that. I have been told I have 27 tears of contributions. so hopefully i will be ok. I was born in may 1950 so i appear to be one of the lucky ones. Hope everyone has a good day.

Your SPA will be 6 July 2010 (unless you were born in the first 5 days of May when it will be 6 May 2010 instead).

Therefore you will need 30 qualifying years for a full state pension.

Not sure if you have any Home Responsibilities Protection years (from after 1975 while looking after a child under 16 and claiming child benefit) in addition to the 27 you mention or not and whether they take you over the 30 years, and if they do you are OK.

If the 27 years is your total (and includes any HRP years) then you should pay class 3 voluntary contributions to get your total to 30 (because the cost is much less than the increase in pension you will get). If you have missing years from 96/97 onwards these need to be purchased by 6 April this year as these will cost less to buy (at most £8.10 pw and less for most years). If no missing years on or after 96/97 then you should still be able to buy missing years back to 1975 but only after 6 April 2009 and at the higher cost of £12.05 pw.

fiftyeighter_2

Thanks Snowman. I have been told I have 27 years in total and my pension date is 6th June. My birthday is may11th. Maybe i have been given the wrong information. i used the pension forecast to get this date. oh well dont suppose a month will make any odds. i'l be a pensioner soon and nothing can stop that unfortunatly. thanks again.

SpanishBlue

I have a letter advising me of my N.I. contributions shortfall for 2005-06. The info that came with the letter clearly states "The amount of the shortfall shown in the attached letter will not go up, even if you delay payment until 5 April 2012"

However, am I correct in thinking that this is now NOT the case, and If I don't pay by April 5th this year, I will have to pay 50% more if I decide to pay it at a later date.

SnowMan

SpanishBlue wrote: »

I have a letter advising me of my N.I. contributions shortfall for 2005-06. The info that came with the letter clearly states "The amount of the shortfall shown in the attached letter will not go up, even if you delay payment until 5 April 2012"

However, am I correct in thinking that this is now NOT the case, and If I don't pay by April 5th this year, I will have to pay 50% more if I decide to pay it at a later date.

I think you are OK to delay payment until 5 April 2012 for the 05/06 tax year especially if you have a notice to say that. There has been some confusion surrounding this but your information is confirmed at

http://www.hmrc.gov.uk/faqs/vol-conts.htm#10

where it says

“If you reach State Pension age on or after 6 April 2010 and want to pay voluntary contributions for the 2005-06 tax year, it has been agreed that the higher rate charge will not be applied and contributions will be able to be paid at the original rate. The normal time limit for payment still applies”

SnowMan

fiftyeighter wrote: »

Thanks Snowman. I have been told I have 27 years in total and my pension date is 6th June. My birthday is may11th. Maybe i have been given the wrong information. i used the pension forecast to get this date. oh well dont suppose a month will make any odds. i'l be a pensioner soon and nothing can stop that unfortunatly. thanks again.

Yes I'm afraid your SPA does look like it is 6 July 2010. If you put your date of birth in the Pensions Service calculator at

http://www.thepensionservice.gov.uk/state-pension/age-calculator.asp

you will get confirmation of this. It also tells you that there is 1 year, 3 months and 8 days before you reach SPA. Not sure if that is not too much information

As you've only got the 27 years (will you get a credit for your last tax year 2009/2010 do you think incidentally to make it up to 28?) it is important to look at making up the 3 years. If you haven't already done so it is really is important as seven-day-weekend said to get a pension forecast find out what years are missing and if it is a year such as 96/97 with the 5 April deadline you need to try and pay it before the end of the tax year. I think most are doing it by registering on line but there is still a delay before you get your registration log in details sent to you so time is running out.

Incidentally are you going to re-register to this website as fifty-niner in May? :rotfl:

Good luck.