Shortfall in National Insurance Contributions

badfan

Hi there, please excuse the quickness I do not have much time to read through existing threads due to having to catch a flight... I would appriciate a response as my partner and I are quite concerned about the recent letter from HM Revenue & Customs.

The later explains that for April 05 to 06 my partners NI contributions fell short by 52 weeks, making a total of £382.20.

He was in full time employment for this time, and has been since (with the same employer) can you tell me please whose responsibility it was to 'pay' these contributions? Does fault lie with the employer here?

Thanks
X

EdInvestor

badfan wrote: »

The later explains that for April 05 to 06 my partners NI contributions fell short by 52 weeks, making a total of £382.20.

He was in full time employment for this time, and has been since (with the same employer)

It's probably an error at HMRC.Call them up and check.

kpmatthews

i got that exact same letter. short by £382.20. i too have been in full time employment with the same employer for the period in question. i'll call the tax office in the morning. little bit more relaxed about it now. :-)

fwor

fwor wrote: »

This thread seems to have been corrupted recently, and some of the posts have gone missing.

Prior to that there was a post that referred to the situation before the recent reform, whereby between the ages of 60 and 65 you would get free NI credits if you did not already have enough years to qualify for a full state pension. The (now missing) post seemed to imply that this would still apply after the reform - meaning that if you had 25 qualifying years by the age of 60 there would be no point in buying the remaining 5 years.

Does anyone know if this is correct or not? I've looked carefully through the Pension Service web pages that describe the reform, but it doesn't ~appear~ to address that specific issue.

To answer my own question: this is not correct (and the Pensions Service Helpline does not always seem to know the correct answer!). Autocredits (the free NI top-up between age 60 and 65) are being phased out. To quote from the current Pensions Service guide:

"Men who reach State Pension age on or after 6 April 2010:

If you are a man aged 60 to 64 and you do not have to pay National Insurance contributions, you may currently receive National Insurance credits automatically. These credits are called autocredits.

But these autocredits are being phased out for men who reach State Pension age on or after 6 April 2010. If you were born on or after 6 October 1954, you will not get autocredits at all. If you were born earlier than 6 October 1954, you will get between one and five years of automatic credits depending on when you were born."

ashm1

http://news.bbc.co.uk/1/hi/business/7153401.stm

The government has rejected a plan to let women boost their state pensions by buying up to nine years' worth of extra National Insurance (NI) contributions.

http://www.ft.com/cms/s/0/1927c872-ae9d-11dc-97aa-0000779fd2ac.html

FYI

jarviser

Just thought I would mention my wife's experience. In 2004 after some years of giving up work and being a traditional housewife, she got the opportunity for a pension forecast and it was obvious that her pension would be around £30 per week because she had not paid NIC since she stopped. We bought back 8 years of contributions and continued paying voluntary contributions for the last 3 years. In the mean time there was a vague warning by letter that she may not need to continue, as HMG were proposing a change, but nothing could be promised, and if it didn't happen it might cost us more in the end. It was not possible to get an online forecast as the people who took over HMRC computer systems don't seem to be able to make the changes til autumn 2008. Muggins kept paying. Well it now seems that 30 years is all that is now needed, and she has 33 years of effective contributions! Had we not seen the coverage on BBC we would have continued paying £30 a month until HMRC finally informed us of the change in the law. We have no idea yet if we can get the 3 years overpayment back, but probably this tax year's overpayment is the best we can expect, because we were "warned". If you are in the same situation you might like to check with HMRC and if necessary cancel the direct debit!

shelovestobuystuff

My hubby had a letter like this a couple of years ago.Turns out his employers paid their N.I. in arrears and the notice and the employers payment had overlapped so it looked like a shortfall when infact it was all okay.He briefly thought that the employer was not passing on the deductions.

shelovestobuystuff

Check that you have HRP home responsibilities protection credited to your NI aco!!!! for any years when you were caring for a child.Its supposed to be automatic when you get child benefit but mine was missing for a few years.Sorted now.Not sure if its for years when you have kids under 5 or under 16?You would have to lok into that.

baby_boomer

I can't imagine anything as unfair as this, even from our current government:

"The new rules giving a full basic state pension based on only 30 qualifying years is only effective for those reaching SPA on or after 6 April 2010. As you will reach yours before then, you will be covered by the existing rules. You will still need 39 (for a female) or 44 (for a male) qualifying years for the full amount."

An arbitrary cut-off with no phased / sliding scale entry for what is a massive improvement in someone's pension entitlement :mad: .

How can they get away with it?

And surely any letter asking for past contributions should also contain a) details of the current system b) details of the future system and c) details of the current entitlement of the correspondent.

If the government was a company, they would be demanding compensation for the public as a consequence of such poor customer service .

jarviser

As a follow-on from my previous post (remember these were Voluntary class 3 NI contributions to make up for the fact she is a housewife and not working) We wrote to the refunds team at HMRC asking for a refund of the 3 years over-paid. Firstly they had to be reassured that we were not made aware of the changes (which we were not, only hints from NIC group, then we saw it on TV). Then we were given a refund of the last two tax years contributions which was almost £700.
It was not possible to get refund for 2005-6 as at the time the contributions were right and proper. But it's a better result than I expected. My own contributions will also probably be over the required contributions for a man, but as these were deducted as a result of my employment, they are as far as I know, non refundable, and if I had not taken early retirement I would still be paying them. I reach state retirement age in 2016 and my wife in 2013 (age 61 1/2)