New State Pension starting amount and full record of qualifying years- trial service

woolly_wombat

coastline wrote: »

I explained I was thinking I would pay £733 a year in NI from post 6th April 2016 to gain any future benefit.

I made a similar enquiry last week but they said they didn't know whether it was possible to start paying now for the current tax year. It was suggested that I try either of the following options:

1. 'Phone a direct National Insurance helpline number that I was given
2. Log back in to the beta check-state-pension website and enter my question into the 'help' box

The 'phone number turned out to be out of date and I have only had an acknowledgement of the 'help' request so far.

My situation differs from yours in that I already have 38 years of national insurance contributions and so was able to very clearly say that I was sure paying previous missed years would not benefit me.

I was toying with the notion of paying Class 3 NICs by Direct Debit for this tax year and beyond using form CA5603, although the usual advice given is to wait until nearer 5th April 2019 and pay for 2016/17 in arrears etc.

This website suggests that it should be possible to pay Class 3 NICs for the current year by DD:
http://www.litrg.org.uk/tax-guides/tax-basics/what-national-insurance#toc-what-are-class-3-national-insurance-contributions-

xylophone

I went through that point twice with the adviser as I have gaps in NI in recent years although I have enough to qualify for old pension of 30 years NI but not the new one due to being contracted out.
I explained I was thinking I would pay £733 a year in NI from post 6th April 2016 to gain any future benefit.
The adviser said I could pay £689 for some of the gaps and £733 after that..
I'll soon find out in a few weeks I suppose ?

See http://citywire.co.uk/new-model-adviser/news/steve-webb-how-to-boost-new-state-pension-payments/a827032

gadgetmind

It's just struck me that the cheapest way for my wife to fund her Class 3 (when Class 2 goes away) is by putting £2880 into her SIPP, taking £3600 out tax free once HMRC have grossed it up, and to then put the £720 extra (plus £13) into Class 2 NI contributions. A few years of that and she's sorted!

woolly_wombat

xylophone wrote: »

See http://citywire.co.uk/new-model-adviser/news/steve-webb-how-to-boost-new-state-pension-payments/a827032

Interesting final paragraph, prior to the 'case study':

"While in theory individuals can often wait until the eve of state pension age before filling recent gaps in their NI record, they may wish to consider doing so as soon as possible. The chancellor is likely to be torn between the attractiveness of enhanced short-term NI revenues through voluntary contributions and the concern about the extra long-term costs they entail. It may be a case of ‘buy now while stocks last’."

woolly_wombat

I have now received a response from the HMRC digital support team.

It says that it is too early to advise me whether I would improve my state pension under the new rules by paying voluntary NICs and that I should "wait until the new pension starts in 2016 before making any decisions".

It then goes on to tell me that I have until 5 April 2023 to pay voluntary NICs for the tax years 2006/07 to 2015/16 - not what I want to do as that would be money down the drain when I already have 38 years of contributions (but less than the full new state pension due to contracted out years).

greenglide

"wait until the new pension starts in 2016 before making any decisions".

So nobody has told them that nSP started last week?

xylophone

"wait until the new pension starts in 2016 before making any decisions".

And you said?

woolly_wombat

xylophone wrote: »

And you said?

I have sent back a reply pointing out that they have not responded to my original enquiry re whether it is possible to pay voluntary National Insurance contributions for the current tax year via Direct Debit. I have reiterated that it is not in my interest to pay for past gaps in my National Insurance record as I have more than 35 years of contributions and have previously been contracted out.

Goldiegirl

woolly_wombat wrote: »

I have sent back a reply pointing out that they have not responded to my original enquiry re whether it is possible to pay voluntary National Insurance contributions for the current tax year via Direct Debit. I have reiterated that it is not in my interest to pay for past gaps in my National Insurance record as I have more than 35 years of contributions and have previously been contracted out.

I'll be interested to find out what response you get.


I think we are in similar circumstances. I've also got 38 years contributions, with quite a lot of contracted out years.


I want to boost my pension to the full single tier sum, so, now the nSP has started, I'd like to pay voluntary NIC's.


I'd be happy to pay by DD, or I'd be equally happy to pay a lump sum.


I'm holding fire for a while, to allow them time to get used to the nSP..... sounds like they are not quite there yet!

xylophone

I have sent back a reply pointing out that they have not responded to my original enquiry re whether it is possible to pay voluntary National Insurance contributions for the current tax year via Direct Debit.

https://www.gov.uk/government/publications/national-insurance-application-to-pay-voluntary-national-insurance-contributions-ca5603

seems relevant?
"For 2016–17 Voluntary Class 3 National Insurance contributions
are £14.10 a week.
You can pay voluntary Class 3 National Insurance contributions if
you are:
• over 16
• not working
• not liable to pay Class 1 and/or Class 2 National Insurance
contributions as a self-employed person
• a woman who revokes her married woman’s or widow’s reduced
rate election part way through a tax year
• exempt from paying Class 2 National Insurance contributions as
a self-employed person"