Voluntary NI Contributions: Class 3 or Class 2 30 July 2020 at 4:15PM edited 30 July 2020 at 4:15PM in Pensions, Annuities & Retirement Planning 4 replies 111 views

KeithOwen

I've been living and working in Germany for the past 20 years, but thinking about retiring early & returning to the UK soon. I did not pay NI whilst I was in Germany, but on checking it seems I can voluntarily pay for about the past 13 years. This seems to be worth it, to get to the 35 years threshold for full pension. This brings me to my question: I have read NI38 about Class 3 vs Class 2 contributions. It seems to imply that you must be self-employed (which i was not) to qualify for Class 2 contributions. However I did talk to the Future Pensions guys and they implied that I was eligible for Class 2 because I was working outside the UK. Can anyone shed any light on NI38?

Blackbeard_of_Perranporth

you can only pay for the previous six years.

All here

https://www.gov.uk/voluntary-national-insurance-contributions

molerat

Blackbeard_of_Perranporth said:

you can only pay for the previous six years.

All here

https://www.gov.uk/voluntary-national-insurance-contributions

Normally so but if you go to here https://www.gov.uk/voluntary-national-insurance-contributions/rates you can currently pay back to 2006-07 until 5 April 2023 under the transitional arrangements for the 2016 pension changes.

As to OP's question, if you were working immediately before you left the UK you can generally pay class 2 contributions for the time you were employed overseas.  You may have to pay part class 2 / part class 3 if there were gaps in employment.

KeithOwen

That's what I thought. However when I check my NI record online, back to 2006-07 it states "You can make up the shortfall

Pay a voluntary contribution of £795.60 by 5 April 2023. This shortfall may increase after 5 April 2021."

Beyond 2006-07 it states "It’s too late to pay for this year. You can usually only pay for the last 6 years."

So a very confusing message here, which I cannot get anyone to clarify

KeithOwen

molerat said:

Blackbeard_of_Perranporth said:

you can only pay for the previous six years.

All here

https://www.gov.uk/voluntary-national-insurance-contributions

Normally so but can currently pay back to 2006-07 until 5 April 2023 under the transitional arrangements for the 2016 pension changes.

As to OP's question, if you were working immediately before you left the UK you can generally pay class 2 contributions for the time you were employed overseas.  You may have to pay part class 2 / part class 3 if there were gaps in employment.

Ah, so that's the reason, thanks! And thanks also for the info regarding Class 2. That's good news!