Qualifying Years of NI For State Pension

drlabman

Not really a tax question. I understand that you need 30 years of NI contributions to be entitled to a full state pension. My question is, what constitutes a year (if that's not a dumb question). Do they have to be full years? Or so many weeks per year? Or the sum of all the weeks divided by 52? Or what?

xylophone

http://www.rights4seniors.net/content/qualifying-years

le_loup

Full years.

drlabman

Seems jolly unfair, if that's the case. You could start work in October, work until the following October i.e. a full year, but have 0 qualifying years. And in this day and age, that scenario is more and more likely.

jimmo

Did you not read the link posted by xylophone?

That is the simplest explanation I have seen but if you also take a look at this one

http://www.hmrc.gov.uk/rates/nic.htm

The LEL for 2012/13 is £107.

Therefore if you earn (52*107) £5,564 in 2012/13 you will have a qualifying year.

drlabman

Yes, I did read the link but didn't understand it if I'm honest. Sorry 'bout that. Thanks for the clarifying example though. So if I understand your example, it's less about being in employment for 52 weeks and more like an annual earnings threshold. Is that right?

Also, am I right in thinking that if you only earn 52*107 a week, you wouldn't be paying any NI but it would still count as a qualifying year.

jimmo

drlabman wrote: »

Yes, I did read the link but didn't understand it if I'm honest. Sorry 'bout that.

Totally understandable but it can help to know.
For what it is worth I would never claim to be an expert in National Insurance but do claim to be pretty good with red tape.
Yes that’s right. If you actually earn more than £107 but less than £146 (the primary threshold) in a week you are counted as if you had contributed for that week despite paying nothing.

However, that is a different matter to whether you achieve a qualifying year.

As I read it you could, in theory, earn £6,000 in a week, nothing for the rest of the year and still achieve a qualifying year.