SP Question

Crabby

I took early retirement 7 years ago aged 55. But no NI paid or credited since.

I’d like to consider increasing my SP to its maximum. An increase of £22.75…Approx. £4.56 * 5 years.

Meaning I’d pay in £14.25 (Class 3) * 52 * 5….Approx £3705, to get £22.24 per week (£1157 per Anum). And I can delay payment until just before my retirement age of 67.

If you are 62 now, your State Pension age is 66.

xylophone

(£1157 per Anum)

Going in for currency smuggling?:eek:

33q

Well things have taken an interesting turn for me. Spoke to DWP and they confirmed I could make up my pension by making Class 3 voluntary NICs and 4 years seemed a good return. However I've now become aware that I can cut my costs further by making Class 2 payments. I have some BTLs and this seems to count as self employment so I can pay the much reduced £2.90 per week rate. This cuts my payback to about 6 months.....happy days indeed.

noh

Landlords who just let properties, are property investors, and therefore the income is classed as investment income, not self employment.

https://www.gov.uk/hmrc-internal-manuals/national-insurance-manual/nim23800

33q

The Lady from DWP assured me this was completely legitimate to pay class 2

I do manage the properties personally, doing repairs and maintenance and I have refurbished them personally.

..... but DWP did not mention or refer to your link

xylophone

https://ion.icaew.com/taxfaculty/b/weblog/posts/propertylettingandnationalinsurance

33q

OK....need to discuss with HMRC....we have 3 properties and we are 'active' .... and over a 7 or 8 year period

Maybe it is too good to be true

Just for once I thought I may actually just get something from the system!!! Rather than just paying in!!

Dazed_and_confused

If you have been declaring the income as a business you have presumably been completing the self employment page on your tax return not the land and property page and being paying class 4 National Insurance?

33q

Today's situation came about with a phone interview from DWP to my wife to discuss topping up her pension. At the very end of the conversation she asked how to pay her class 3 and simply mentioned paying her self assessment and paying via the Government Gateway. The lady then said wife wife could pay Class 2 by ticking a box on her tax form.

In no way was any of this initially prompted by my wife. She and I were simply really pleased that we may be able to reduce to cost of topping up our pensions.

Looking at the responses to my 'gleeful' post I am now somewhat deflated.

KarriNut

Hello.

I have also been talking to the contributions people this week. My questions were very similar, How my husband could pay class 3 contributions was the primary issue. At the end of my conversation I asked a "oh by the way" query, should I have been paying class 2 for x years since I moved to salaried employment from self employment? My only other income is from a single rental property. The lady confirmed I should. My tax return is submitted by an accountant (another hangover from self employment).
So my accountant and the NI people agree I should pay class 2 on a small profit from a single rental property.