Guide discussion: Voluntary national insurance contributions

misssandals

I have received state pension since 2018, having retired from full time work in 2011, and mostly working self employed after that.  I didn't pay NI at the time but in 2017 looked to make additional contributions for missed years, was told I only could for 2016/7, which I did, though it was a devil of a job to then get my due pension increase.  Checking whether I can now make contributions (and benefit from them) for missed years is proving difficult, being directed between future pensions and pensions phone lines and back to websites.  I've written a letter now. Has anyone else had a similar experience and know if I should be able to pay and benefit from the missing contributions (I don't receive full pension, about £40.00 a week short, in part because of SERPs, working in the public sector.

motivator26

Hi, I am trying to clarify my wife's state pension entitlement. On the government.uk website section it says that the pension forecasted is for the maximum.  However it then says she has options to pay for 4 gap years. My wife is 63 and doesn't intend to work any further.  Can someone explain if she needs to pay for gap years?
Thanks

molerat

motivator26 said:

Hi, I am trying to clarify my wife's state pension entitlement. On the government.uk website section it says that the pension forecasted is for the maximum.  However it then says she has options to pay for 4 gap years. My wife is 63 and doesn't intend to work any further.  Can someone explain if she needs to pay for gap years?
Thanks

If you are looking at the NI record then that's a matter of fact, the year is not full and will cost £xxx.xx to fill, it is not advice, a recommendation to pay or an indication that those years would have any effect on her pension.

  The forecast will clearly state if she needs to do anything to get that big green box amount.

Sarahspangles

misssandals said:

I have received state pension since 2018, having retired from full time work in 2011, and mostly working self employed after that.  I didn't pay NI at the time but in 2017 looked to make additional contributions for missed years, was told I only could for 2016/7, which I did, though it was a devil of a job to then get my due pension increase.  Checking whether I can now make contributions (and benefit from them) for missed years is proving difficult, being directed between future pensions and pensions phone lines and back to websites.  I've written a letter now. Has anyone else had a similar experience and know if I should be able to pay and benefit from the missing contributions (I don't receive full pension, about £40.00 a week short, in part because of SERPs, working in the public sector.

You might be better starting a new post rather than have yours get lost in the current flurry.

It sounds like you only had one or two ‘available’ tax years after the 2016 rule changes in which you could contribute. The tax year in which you reach State Pension age isn’t counted. Was 2017/18 also available? If you’re asking about scope for additional self-employed contributions then you need to give a bit more detail on that.

motivator26

Molerat,  OK in that case we need to pay the gap years, on the basis that she is not going to be working to cover them before dhe retires.
Thanks for the confirmation. 

molerat

motivator26 said:

Molerat,  OK in that case we need to pay the gap years, on the basis that she is not going to be working to cover them before dhe retires.
Thanks for the confirmation. 

So what does the text below the big green box actually say ?

biscuitbob

I have 2 questions / points of confusion!
(1) If you pay by bank transfer, how do they know which years you're paying for? I'll probably pay them all (I have 11 years that I can top up), but it just makes me skeptical of the process - if I only wanted to pay for some of them, how would they allocate it? 
As background, I've been working abroad, so I just got a letter to say that I can pay the lower Class 2 amounts, which lists the new amounts to pay, and then it instructs me that I can pay by bank transfer. 
(2) I'm confused as to what reference number to use for my bank transfer. The letter says to use my National Insurance number, and nothing else, to avoid it going to the wrong place (for example, not the 18-digit HMRC number Martin has been saying to obtain). But when I go to the online instructions for bank transfers on gov.uk, it says to use National Insurance number, followed by 'IC', then surname then first initial. I'm leaning towards doing the latter for a belt & braces approach. 
Any insight would be appreciated! (I can't really call them as I'm abroad and my phone plan doesn't cover international calls, if I have to add that service it'll probably be extortionate.)

pritchah

Hello - my wife has 11 payable gaps which we calculate as needing £8.6k to fill

She has just passed her 69th birthday and is receiving £708.16 state pension every four weeks

I think her full pension entitlement would be £805.32 (same as I'm getting) - so she'd be better of by £97 every four weeks, or £1164 a year

So according to the MSE ready-reckoner if we paid the £8.6k she would break even in three years

But, as she asked me yesterday £8.6 divided by £1164 looks more like it would take around 7 years to pay off

I'm sure my maths or logic is letting me down somewhere, or is it all to to with pre- and post-tax amounts?

Help please

Dazed_and_C0nfused

pritchah said:

Hello - my wife has 11 payable gaps which we calculate as needing £8.6k to fill

She has just passed her 69th birthday and is receiving £708.16 state pension every four weeks

I think her full pension entitlement would be £805.32 (same as I'm getting) - so she'd be better of by £97 every four weeks, or £1164 a year

So according to the MSE ready-reckoner if we paid the £8.6k she would break even in three years

But, as she asked me yesterday £8.6 divided by £1164 looks more like it would take around 7 years to pay off

I'm sure my maths or logic is letting me down somewhere, or is it all to to with pre- and post-tax amounts?

Help please

Could you explain why you think buying 11 years is appropriate?

And why is your pension amount relevant to her?

If she is getting £177.04/week now then wouldn't 7 years take her to £221.20/week?

However she may not have 7 years which can benefit her, you would need to provide more details for anyone to help you with that aspect.

pritchah

Dazed_and_C0nfused said:

pritchah said:

Hello - my wife has 11 payable gaps which we calculate as needing £8.6k to fill

She has just passed her 69th birthday and is receiving £708.16 state pension every four weeks

I think her full pension entitlement would be £805.32 (same as I'm getting) - so she'd be better of by £97 every four weeks, or £1164 a year

So according to the MSE ready-reckoner if we paid the £8.6k she would break even in three years

But, as she asked me yesterday £8.6 divided by £1164 looks more like it would take around 7 years to pay off

I'm sure my maths or logic is letting me down somewhere, or is it all to to with pre- and post-tax amounts?

Help please

Could you explain why you think buying 11 years is appropriate?

And why is your pension amount relevant to her?

If she is getting £177.04/week now then wouldn't 7 years take her to £221.20/week?

However she may not have 7 years which can benefit her, you would need to provide more details for anyone to help you with that aspect.

Thanks. I just put down all I thought was relevant

What I really wanted was for my wife to be able to fill her NI gaps so she got the full pension

Last thing I want to do is overpay the govt