Are NI contributions made if you claim Pension Credit?

rubbish22

We have been claiming Pension Credit since 2014
My partner just went to Gateway and reviewed her contributions and in the last 5 years it says "Year is not full" and asks her to make a contribution of £765 per year to rectify.
I assumed her NI contributions were being kept up. She is 61 and due a pension in 5 years but will it be reduced if there are no NI contributions?
Has DWP made a mistake?

poppy12345

rubbish22 said:

We have been claiming Pension Credit since 2014
My partner just went to Gateway and reviewed her contributions and in the last 5 years it says "Year is not full" and asks her to make a contribution of £765 per year to rectify.
I assumed her NI contributions were being kept up. She is 61 and due a pension in 5 years but will it be reduced if there are no NI contributions?
Has DWP made a mistake?

No, pension credit doesn't pay NI credits. To know how much state pension she can claim when the time comes then she'll need to look at her state pension forecast online. https://www.gov.uk/check-state-pension

andreaj1

Hi, unfortunately it does not look as though pension credit gives NI contributions - see https://www.gov.uk/national-insurance-credits/eligibility. There are other circumstances that can apply such as grandparents and other family members aged over 16 but under state pension age that provide care for a child aged under 12 may also be able to get Class 3 Specified Adult National Insurance credits. 

calcotti

There are no NI credits for Pension Credit because it is a Pension age benefit. In any event your wife is not claiming Pension Credit, you are. Even for benefit which attract NI credits it is the claimant that gets the credits not the partner of the claimant. The exception is Universal Credit because for UC both halves of a couple have to claim.

If she wants NI credits she would need to register as a jobseeker or if she has a health conditions limiting her ability to work apply for ESA and be assessed to see if she has limited capability for work.

She should get a state pension forecast to see if she actually need some any more years of contributions/credits to get a full pension. https://www.gov.uk/future-pension-centre
If she already has 35 years of contributions/credits and has never been contracted out she will already have a full pension entitlement.

rubbish22

calcotti said:

There are no NI credits for Pension Credit because it is a Pension age benefit. In any event your wife is not claiming Pension Credit, you are. Even for benefit which attract NI credits it is the claimant that gets the credits not the partner of the claimant. The exception is Universal Credit because for UC both halves of a couple have to claim.

If she wants NI credits she would need to register as a jobseeker or if she has a health conditions limiting her ability to work apply for ESA and be assessed to see if she has limited capability for work.

She should get a state pension forecast to see if she actually need some any more years of contributions/credits to get a full pension. https://www.gov.uk/future-pension-centre
If she already has 35 years of contributions/credits and has never been contracted out she will already have a full pension entitlement.

Thank you very much indeed for taking the time to reply.
She has 32 full years.
Is it worth paying any more money in from any potential house sale profit to increase her pension?

rubbish22

poppy12345 said:

rubbish22 said:

We have been claiming Pension Credit since 2014
My partner just went to Gateway and reviewed her contributions and in the last 5 years it says "Year is not full" and asks her to make a contribution of £765 per year to rectify.
I assumed her NI contributions were being kept up. She is 61 and due a pension in 5 years but will it be reduced if there are no NI contributions?
Has DWP made a mistake?

No, pension credit doesn't pay NI credits. To know how much state pension she can claim when the time comes then she'll need to look at her state pension forecast online. https://www.gov.uk/check-state-pension

Thanks for your reply.

rubbish22

calcotti said:

There are no NI credits for Pension Credit because it is a Pension age benefit. In any event your wife is not claiming Pension Credit, you are. Even for benefit which attract NI credits it is the claimant that gets the credits not the partner of the claimant. The exception is Universal Credit because for UC both halves of a couple have to claim.

If she wants NI credits she would need to register as a jobseeker or if she has a health conditions limiting her ability to work apply for ESA and be assessed to see if she has limited capability for work.

She should get a state pension forecast to see if she actually need some any more years of contributions/credits to get a full pension. https://www.gov.uk/future-pension-centre
If she already has 35 years of contributions/credits and has never been contracted out she will already have a full pension entitlement.

Thanks for your reply.

kaMelo

calcotti said:

She should get a state pension forecast to see if she actually need some any more years of contributions/credits to get a full pension. https://www.gov.uk/future-pension-centre
If she already has 35 years of contributions/credits and has never been contracted out she will already have a full pension entitlement.

That is not strictly true.  Only those who started work from April 2016 will be guaranteed a full new state pension with thirty five years contributions.
 Everyone else, including the OP's wife, is in a transitional arrangement whereby your pension entitlement is worked out under both old and new systems and you get whichever is the better. You used to require 44 years for men and 39 for women, this changed to 30 years for all in 2010 and then in combination with the new flat rate state pension to 35 years in 2016. 
Because of this it is possible to have 35 years contributions (or more)  and not be entitled to a full flat rate state pension. The only way to know for sure is to get a state pension forecast. If it shows a shortfall this can be down to many reasons, contracting out being one of them but not the only one.

p00hsticks

rubbish22 said:

She has 32 full years.
Is it worth paying any more money in from any potential house sale profit to increase her pension?

If you have the option and money to buy additional NI years to incrase your state pension and have average life expectancy then it is very good value - a one off payment of around £750 will increase your state pension by £5 a week for life. Your individual state pension forecast will tell you how many more years are required to maximise your state pension.

https://www.gov.uk/check-state-pension

calcotti

kaMelo said:

calcotti said: She should get a state pension forecast to see if she actually need some any more years of contributions/credits to get a full pension. https://www.gov.uk/future-pension-centre. If she already has 35 years of contributions/credits and has never been contracted out she will already have a full pension entitlement.

That is not strictly true.  Only those who started work from April 2016 will be guaranteed a full new state pension with thirty five years contributions.
 Everyone else, including the OP's wife, is in a transitional arrangement whereby your pension entitlement is worked out under both old and new systems and you get whichever is the better. You used to require 44 years for men and 39 for women, this changed to 30 years for all in 2010 and then in combination with the new flat rate state pension to 35 years in 2016. 
Because of this it is possible to have 35 years contributions (or more)  and not be entitled to a full flat rate state pension. The only way to know for sure is to get a state pension forecast. If it shows a shortfall this can be down to many reasons, contracting out being one of them but not the only one.

Absolutely, which is why I stated if she "has never been contracted out". I think for someone who has never been contracted out it will be true that with 35 years NI contributions there will be full entitlement to NSP. It is the deductions for periods of contracting out that can reduce the 2016 starting amount.
It's also why I said "The only way to know for sure is to get a state pension forecast. "

xylophone

It is perfectly possible that for somebody who had 35 years and never contracted out there would be an entitlement to a pension higher than full new state pension.

It is also possible that with 32 years  and never having been contracted out there would still be an entitlement to a full NSP.

There are other possible permutations......

Everybody should obtain a state pension forecast.