Guide discussion: Voluntary national insurance contributions

Dazed_and_C0nfused

intalex said:

Quick question on voluntary contributions and state pension age reviews:
It is known how many (available) years are left to be able to pay until state pension age, whether through working or voluntary NICs, in order to increase the count of qualifying years. It is based on this that the maximum possible state pension is specified on the online state pension record. If now the state pension age was increased from 67 to 68, would the (available) years left to pay and accordingly the maximum possible state pension also be higher?

Yes and no would be my expectation.

You would have one extra year to add to reach the standard new State Pension.

But, other than the annual triple lock increases I can't see any likelihood of the standard amount changing any time soon.

intalex

Dazed_and_C0nfused said:

You would have one extra year to add to reach the standard new State Pension.

But, other than the annual triple lock increases I can't see any likelihood of the standard amount changing any time soon.

Thanks, by higher, I meant the extra value in lieu of the one extra year available to add, not other time value of money increases...

Dazed_and_C0nfused

intalex said:

Dazed_and_C0nfused said:

You would have one extra year to add to reach the standard new State Pension.

But, other than the annual triple lock increases I can't see any likelihood of the standard amount changing any time soon.

Thanks, by higher, I meant the extra value in lieu of the one extra year available to add, not other time value of money increases...

If it helps you reach the standard maximum (£221.20) then yes it could help.

But I don't think the £221.20 will change just because you don't get it until you are 68.  That is the normal State Pension age for the majority of people now anyway.

intalex

Dazed_and_C0nfused said:

If it helps you reach the standard maximum (£221.20) then yes it could help.

Thanks, that's exactly it, makes a difference in helping decide how many gaps to fill voluntarily before April.

Trying to find relevant info on what is the latest research / expert view on the likelihood of SPA increases being brought forward... any thoughts on a recent and credible article?

intalex

One more related question, is the tax year in which one reaches SPA an "available" year to pay?

Eg if you reach SPA in November 2050 and your Class 1 contributions deducted from payroll in April + May 2050 is sufficient for the tax year 2050/51 to count in theory, can that actually count as a qualifying year for SP given that is the tax year in which SPA is reached?

molerat

No.  The tax year in which you reach SPA cannot be counted towards your SP entitlement.

intalex

molerat said:

No.  The tax year in which you reach SPA cannot be counted towards your SP entitlement.

Thanks, but in the months within that tax year leading up to the birthday, should NICs be deducted in payroll, and if so, should these NICs be refundable?

Dazed_and_C0nfused

intalex said:

molerat said:

No.  The tax year in which you reach SPA cannot be counted towards your SP entitlement.

Thanks, but in the months within that tax year leading up to the birthday, should NICs be deducted in payroll, and if so, should these NICs be refundable?

Yes they should be deducted and no they aren't repayable.

intalex

Dazed_and_C0nfused said:

intalex said:

molerat said:

No.  The tax year in which you reach SPA cannot be counted towards your SP entitlement.

Thanks, but in the months within that tax year leading up to the birthday, should NICs be deducted in payroll, and if so, should these NICs be refundable?

Yes they should be deducted and no they aren't repayable.

Isn't that a bit of a waste given they don't count for anything?

molerat

intalex said:

Dazed_and_C0nfused said:

intalex said:

molerat said:

No.  The tax year in which you reach SPA cannot be counted towards your SP entitlement.

Thanks, but in the months within that tax year leading up to the birthday, should NICs be deducted in payroll, and if so, should these NICs be refundable?

Yes they should be deducted and no they aren't repayable.

Isn't that a bit of a waste given they don't count for anything?

NI contributions are just another form of tax which you stop paying when you reach state pension age with certain years, as defined in legislation, ticking the box towards the state pension.