Guide discussion: Voluntary national insurance contributions

KFPanda

I like the NI voluntary pension contribution article and covers an area I was looking at last year.
Unless I have misread there are a couple of scenarios it does not cover for persons who have retired early (before normal pension age) and do not have enough NI pension contribution years for a full state pension.
This is the situation I am in at present and am looking to make additional NI contributions having retired at age 54. 
I think I am able to make additional contributions up to my normal pension age i.e not a ‘gap’ but a top up to my existing years. I’m not sure your article makes clear if this can be done.
Furthermore, I have looked at whether it is better, in this situation, to wait to make additional contributions until I near my normal pension age or make them now.  My calculations and conclusion was to wait until nearer my normal pension age.

The above may enhance the, already excellent, commentary on your website on this matter.

Silvertabby

Sku11 said:

Silvertabby said:

RAF pensioner here.

You left the Armed Forces well before the details of the new single tier pension were announced, so how on earth can you infer that your admin bods were remiss in not telling you how your Armed Forces pension would interact with the new rules?  We didn't have  crystal balls! ........

@ Silvertabby 

Please don't take my post personally - It is only my experience but there was very little interaction with Pers Admin most of Admin was at Unit level.  I was given a book about the Forces Pension, it had some pictures in it   

This is more about Boosting NI Qualifying years than my Forces pension, I'm not blaming anyone for my situation...

Fair do - it's just that I get very frustrated at the lack of interest in something as important as pensions!  Not just the Armed Forces - I went on to do 20 years as a LGPS administrator, and this 'boring pensions' attitude was evident there, as well.

Are you aware that Veterans UK are currently trying to trace Ks of ex Forces personnel (or their widows) who failed to collect their deferred pensions at 60?  I have personally told two vets that, despite what they were told by the barrack room lawyers, the lump sum they received for completion of 12 years service was just their resettlement grant and was NOT in lieu of pension rights.  

Sku11

Silvertabby said:

Are you aware that Veterans UK are currently trying to trace Ks of ex Forces personnel (or their widows) who failed to collect their deferred pensions at 60?  I have personally told two vets that, despite what they were told by the barrack room lawyers, the lump sum they received for completion of 12 years service was just their resettlement grant and was NOT in lieu of pension rights.  

@Silvertabby
I am aware that there is a lot of confusion in general about Forces pensions, mainly from those in the 50 > 60 age group and I have possibly seen your input on social media when someone has a query about Forces pensions (it sounds like you have a massive knowledge through your careers).  I always refer people to their scheme administrators as there are too many variables between individuals despite similar Forces careers.

molerat

KFPanda said:

I like the NI voluntary pension contribution article and covers an area I was looking at last year.
Unless I have misread there are a couple of scenarios it does not cover for persons who have retired early (before normal pension age) and do not have enough NI pension contribution years for a full state pension.
This is the situation I am in at present and am looking to make additional NI contributions having retired at age 54. 
I think I am able to make additional contributions up to my normal pension age i.e not a ‘gap’ but a top up to my existing years. I’m not sure your article makes clear if this can be done.
Furthermore, I have looked at whether it is better, in this situation, to wait to make additional contributions until I near my normal pension age or make them now.  My calculations and conclusion was to wait until nearer my normal pension age.

The above may enhance the, already excellent, commentary on your website on this matter.

It is more about filling gaps because the vast majority come up to SPA and realise they do not have the full pension so need help on what to do.

As to buying now or in the future, NI VCs are like a sort of reverse life insurance - if you die you get nothing.  Buying early, if you have enough spare years going forward, therefore could be a bit of a gamble - has that No10 bus got your name on it ?

dunroving

I've only now become aware of the possibility to make voluntary contributions beyond the past 6 years (and quite surprised, as [I thought] every other site, article, etc., has in my recollection cited a 6-year limit).

In the article and in his programme, Martin mentions years spent overseas. Are these not eligible to back-pay Class 2 contributions, rather than Class 3? 

molerat

dunroving said:

I've only now become aware of the possibility to make voluntary contributions beyond the past 6 years (and quite surprised, as [I thought] every other site, article, etc., has in my recollection cited a 6-year limit).

6 years is the general rule and currently applies to anyone reaching SPA prior to April 2016.  Back to 2006-07 was introduced along with the 2016 pension to ensure everyone had the opportunity to gain the 10 years needed to get any pension.  Normality will resume from April next year and all years from 2006-07 to 2016-17 will cease to be available

In the article and in his programme, Martin mentions years spent overseas. Are these not eligible to back-pay Class 2 contributions, rather than Class 3?

There is certainly that possibility but seemingly does take some pushing.

DBdoobydoo

dunroving said:

I've only now become aware of the possibility to make voluntary contributions beyond the past 6 years (and quite surprised, as [I thought] every other site, article, etc., has in my recollection cited a 6-year limit).

In the article and in his programme, Martin mentions years spent overseas. Are these not eligible to back-pay Class 2 contributions, rather than Class 3? 

Provided you were employed or self employed abroad you will be eligible to pay Class 2 voluntary contributions for those years abroad. When I bought some added years about 3-4 years ago HMRC didn't ask for any evidence of my employment abroad but I have heard that more recently they have asked people to provide evidence of their employment status abroad.

The HMRC leaflet NI38 'Social Security abroad' has all the details. 

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/947544/NI38_12_20.pdf

GoGlos

I am just over State Pension Age and believe I could top up by NI record by one or two years' voluntary contributions. I have now called the Pension Service three times and been told that I should get a letter about this within 7 to 10 days but nothing has turned up.  They cannot give me a reason for this and just put the request in again.  Anyone else have the same problem?
Thanks

Captain_Wales

The step by step guide to to boosting the state pension (SP) by acquiring additional NI years was very informative. I am receiving SP since the 2016/17 tax year. I followed the steps as follows:

                   Viewed NI record via govt gateway. I have 22 years of full contributions and 25 years when I did not pay enough.

                   My pension is exactly 22/35 * £185.15

                   My wish is, therefore, to acquire 13 more NI years.

                   Phoned the Pension Service as advised by Martin. There is a long wait to speak to an adviser. I didn't realise that
                   'change of circumstances' was the option to choose so on the first call was advised to call again and given the HMRC
                    number to call to get a reference to use in making a payment.

                   Phoned the Pension Service again and selected 'change of circumstances'. An even longer wait this time. The 
                   adviser went through the security questions and requested the NI number. There was no specific advice that if
                   I buy x more years I would be better off. He said a letter would be sent to me but stressed more than once that the
                   letter would take months to come. I expect the letter to confirm that I will be better off if I buy more years and that
                   I can buy 13 but, of course, until I make the payment nothing will change.

                   It was not what I expected to happen and I have impression that Martin Lewis may not be the most popular man
                   in Whitehall. The adviser did ask what had prompted this enquiry.

I am not particularly happy as I wish to invest in extra years asap to obtain the maximum benefit but will not get confirmation from the DWP that my assumptions as correct for a long time. I obviously cannot make a payment via HMRC until I am assured the
expected benefit will result.

Has anyone had a different response from the Pension Service ?

murfjohn

Silvertabby said:

murfjohn said:

I am 66 already claiming pension and following Martin's guide found I am seven years short of NI contributions. This shortfall was because I took early retirement and didn't claim anything. I was told at the time NI contributions were fully paid up and would not need to pay anymore. This was from the job centre and was obviously incorrect.  I have contacted the Voluntary National Insurance Contributions on 0800 7310469, and was told as I had some thirty years ago been contracted out, they would have to work out how best to proceed, and because of the number of enquiries this might take up to three months. So that was a month ago. I will update this as and when i get the details.

With that amount of contracted out service, only 2016/17 onwards contributations will add to your State pension.  

Sorry I didn't make it clear in my post. I was not contracted out for thirty years but thirty years ago was contracted out for a few years. Not a clue how many as my memory is not as good as it was