Class 2 NI not being Axed at April 2019

bostonerimus

Joey_Soap wrote: »

Sorry to be a bit thick here, but what exactly does that mean? I have been working overseas the last three years, now age 62 and intend to retire back to the UK age say 64/65. State pension age for me is 66. For the last three years I have paid no UK NIC. The forecast says I have to pay three more years NIC to get a full state pension under the new rules. It is in my interest to do so. Thanks.

If you are an expat and work for an overseas employer you can apply to pay voluntary Class 2 NI.

Joey_Soap

bostonerimus wrote: »

If you are an expat and work for an overseas employer you can apply to pay voluntary Class 2 NI.

Thanks. I'd previously understood that Class 2 was no longer an option. But I'll be sure now to write to HMRC back home after April 5th '19 and ask to pay the last three years at Class 2. Then one more year of NIC (next year) and I'll have the maximum allowable state pension. Cheers.

JezR

Thrugelmir wrote: »

Tax system requires simplification. This was an ill thought out idea. That simply increased the burden unintentionally on a lower paid sector. Blame a previous Chancellor for creating this mess by maintaining a pledge not to increase income tax rates. Instead burying future changes to NI in every budget small print.

Class 3 and Class 2 flat rate NI contributions used to be roughly the same - IIRC Class 2 was a bit more as it carried an entitlement to a slightly greater range of contributory benefits. Gordon Brown was responsible for the 'reform' that cut Class 2 drastically but also raised the percentage on Class 4. At the lower end this resulted in a reduction, but self employed earnings didn't have to be that high for it to be an increase overall.


What was overlooked (maybe) was the consequence on contributions from people working overseas, plus those that created 'sham' self-employment to pay Class 2 rather than Class 3. Maybe neither of these categories are widely used; then again maybe not.

Johnnyboy11

Joey_Soap wrote: »

Thanks. I'd previously understood that Class 2 was no longer an option. But I'll be sure now to write to HMRC back home after April 5th '19 and ask to pay the last three years at Class 2. Then one more year of NIC (next year) and I'll have the maximum allowable state pension. Cheers.

There's a form to fill in, appended to HMRC NI38. You can backdate NI Class 2 NIC payments up to 6 pevious tax years. Watch the eligibility rules, the main one being that you had no significant break between UK work and overseas work (one week max, I think). So take care filling in the form.


Best to include a covering letter with the form, explaining that you want to pay backdated Class 2 NICs only (Not the more expensive Class 3's), and also ask to set up a Direct Debit for future Class 2 NICs. They will send you back a letter with a table showing what you need to pay for each eligible tax year and another letter confirming your Diect Debit is set up. You can then reply to the first letter enclosing a cheque. Then check your NI account online to make sure they credit you with the previous NI years (will take a few weeks to show). Also check that your Direct Debit is working as planned. Call them is there is a problem.


On a related matter, if you had a private pension opened before you left the UK (or, I believe, opened one in the tax year that you left the UK), you can pay £2,880 into your UK private pension and HMRC will top it up to £3,600 automaticlly. You can do this in the year that you left the UK, and the following 5 tax years. More free money, which is nice

Joey_Soap

Johnnyboy11 wrote: »

There's a form to fill in, appended to HMRC NI38. You can backdate NI Class 2 NIC payments up to 6 pevious tax years. Watch the eligibility rules, the main one being that you had no significant break between UK work and overseas work (one week max, I think). So take care filling in the form.


Best to include a covering letter with the form, explaining that you want to pay backdated Class 2 NICs only (Not the more expensive Class 3's), and also ask to set up a Direct Debit for future Class 2 NICs. They will send you back a letter with a table showing what you need to pay for each eligible tax year and another letter confirming your Diect Debit is set up. You can then reply to the first letter enclosing a cheque. Then check your NI account online to make sure they credit you with the previous NI years (will take a few weeks to show). Also check that your Direct Debit is working as planned. Call them is there is a problem.


On a related matter, if you had a private pension opened before you left the UK (or, I believe, opened one in the tax year that you left the UK), you can pay £2,880 into your UK private pension and HMRC will top it up to £3,600 automaticlly. You can do this in the year that you left the UK, and the following 5 tax years. More free money, which is nice

Thank you. That sounds like great advice. I'll get myself set up ready to send the form off after April 5th.

jahwobble

Hi
I have a payment schedule from HMRC to pay missing years in my NI record at Class 2 rates.

Please can someone give me the correct bank details, IBAN/BACS etc. to make the payments to from:
i) a UK bank account
ii) an overseas bank account.


Thank you

xylophone

Hi
I have a payment schedule from HMRC to pay missing years in my NI record at Class 2 rates.

Please can someone give me the correct bank details, IBAN/BACS etc. to make the payments to from:
i) a UK bank account
ii) an overseas bank account.

Is this relevant to your query?



https://www.gov.uk/pay-class-2-national-insurance/bank-details

jahwobble

xylophone wrote: »

Is this relevant to your query?



https://www.gov.uk/pay-class-2-national-insurance/bank-details

Great - thanks! Has anyone on this forum made Class 2 NICs from a non-UK bank account?

MoneySaving_ExNOT

This is just to save me some time - I'd be very grateful for some help:
The last couple of times I rang HMRC I spent forever in a queue so, before I spend an hour on the phone please, please could I ask you MSE experts a quickie regarding class 2 NI contributions:

Question: How do I actually go about making a payment?
I completed a tax return showing a small profit and wish to make a class 2 NI contribution for the year to April 2018.
I just checked my (NI) State Pension Summary and it shows a gap (Year is Not Full), but says I should make a payment of £700 odd.
Do I just make a payment of Class 2 NI (£2.95 * 52) £153.40 by bank transfer and put the tax reference number I was given when I submitted my tax return?

Is it that simple, or do I have to phone them and ask them to 'bill me' - so to speak.


Thank you in anticipation

TBC15

28yrs ago there was an obligation to pay class 1 for the first expat year (nobody did) is it still the case?