Shortfall in National Insurance Contributions

EdInvestor

Correct. He won't.

Anybody who retires before 2010 and is short of the min 44/39 years presently required still has to pay in up to their retirement date even if they have more than 30 years.

Beate

Bummer.

strawberrylane

Please can someone clarify for me, under the planned new pension rules do we know for sure yet whether there will still be a concept of automatic credits for the 5 years prior to retirement age? Under the new rules my state retirement age will be 66. If I get to 61 and have 25 qualifying years at that point, will I then get 5 additional years automatically credited between age 62 and 66?

seven-day-weekend

Beate wrote:

There is an article in today's financial section of the Sunday Express titled "Pension top-ups refund storm" which basically says that any top-ups paid since 25 May of last year, which is when the new legislation about 30 year's worth of contributions instead of 44/39 years was announced, would be entitled to a refund. The Pensions Bill becomes law later this year and they do not know yet how to refund payments.
My friend has paid the powers that be £710.55 last September which consists of a shortfall for the tax years 2000/2001 up to the tax year 2003/2004. Unfortunately, he will turn 65 on 4 April 2009, so, as the new rules will apply to anyone retiring in April 2010 or later, does that mean he will not get this money refunded because he is just one single year too old?

Yes, I reach retirement age in Janary 2010 and am still under the 39/44 year rule . I have one more year to pay.

castellburt

ashm1 wrote: »

Hi,

I have misplaced the letter (only have the guidance to hand). It's along the lines of I can pay £x's by 5 April 2010 due to shortfall in NI contributions to state pension. I need to read all the guidance but is this shortfall common?


Kind regards,

Ashley.

I had a similar letter a couple of years ago which told me that because of the shortfall in payments I would have to pay literally thousands of pounds. I was very very upset and frightened- I thought that I was covered by my husbands NI. but it was not so......I am still confused about this- but as my income is so low all payment was cancelled until this year- which reminds me I should phone them to find out what is going to happen now. Caroline

seven-day-weekend

Caroline, you don't HAVE to pay anything if you are not earning enough. In this case you will be entitled to a 60% Pension based on your husbands' contributions if you are over 60 and he is 65, and if you are still married.

I don't know your situation, but it may be worthwhile paying voluntary contributions if you can. Ask about it when you ring.

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/PensionsAndRetirement/FinancialPlanningForRetirement/DG_10021384

http://www.pensionsadvisoryservice.org.uk/state_pensions/entitlement/

ashm1

I received a letter today from the Inland Revenue informing me that my record has been updated and there is no shortfall in the tax year 04/05.



Just need to decide whether to buy the 03/04 year now or closer to 2010....

waycombe

Not so much a reply as another question, so at 59 I have a large shortfall in contributions (due to numerous things through my life), can I pay a lump sum to bring my contributions up to the 30 years or whatever is required or do I just resighn myself to starving to death when I get a bit older?[/I]

EdInvestor

At the moment you can pay up to around 10 back years.Will that bring you up to 30 years?

If you are a man, you have another 6 years to go to 65 also, of course.

If you are a woman the 30 year rule won't apply to you and situation might be quite gloomy, but have you claimed any Home responsibilities credits for looking after children, if due?

Check here:

https://www.thepensionservice.gov.uk

jamesd

Get the state pension forecast. It'll tell you what years you can buy. Each year up to the limit will increase the pension you get so buying all available years is probably a good idea.

Beyond that, once you have those details start a new discussion with more of your circumstances including details of any work or personal pensions and your projeced income from the two state pensions and people will say what they suggest looks best for you.