Advice on whether to continue NI payments

kazza_2

Hello people

I am self employed though my own limited company and have 30 years qualifying NI contributions out of the maximum of 35.

I currently have 3 sources of income: property rental, dividends from my company and salary from my company (minimum to get full tax allowance). I am in the higher rate tax band.

The question is, am I financially better off halting my salary payments now in favour of increasing my dividend payments or continuing as I am for the next 5 years until I have the full 35 years of NI contributions? If I halt the salary I will receive £20 per week less pension when I retire but my account has told me I will pay less tax now on my income.

Thanks.

greenglide

So you aren't "self employed". You are, presumably, a director of the company which employs you.

Does the answer to this not depend on your age?

If you are close to SPa then if you current SP entitlement is already over the nSP maximum amount (£148 or so) then any contributions between now and 6/4/2016 would increase your S2P entitlement so could be worthwhile.

If your current entitlement is currently short of £148 paying the extra 5 years may be worthwhile.

What is your age? Have you ever been contracted out by a DB pension scheme?