Voluntary NI Contributions

WelshKAD

Hello I have just paid £4800 NI voluntary contribution placed into the last 6 tax years, this has now increased my weekly state pension due in Nov 2024 by £31 per week or £1650 per year. As long as I live 2.97 years I will have made a good choice.....
I just want to help anyone looking to do the same. I had 12 years I could contribute into however my online forecast only said I was 2 years short of the 35 required. Having spoken to the Future Pension Centre I then realise I had to contribute into the last 6 years from 2016 to maximise my pension especially as I had been contracted out of SERPS many years ago.
Having spent 2 days trying to get through to the FPC I finally managed to get through via the DWP call centre on 03002003500.I was on hold for 75 minutes but is was worth it as they were able to provide my personal 18 digit NI number needed as a reference to pay any voluntary contribution ( after speaking to the DWP). They were also able to put me directly through to the FPC who informed me how much I needed to contribute to maximise my State Pension and into what years to allocate the contributions
The DWP will then need to know what years you are contributing into and the 18 digit reference they will then provide is specific to that contribution and NI  years you wish it allocated.... I transferred the money on the 6th March and it is already showing on my Gateway forecast.... Long winded but worth it 

mark55man

Thank you for helpful words.  There are a number of posts on here asking questions but not that many reassuring posters that it all works and more importantly is great value

Marbles55

Why oh why does all ‘official’ guidance - Gov.UK, CAB, Age UK etc - quote that 35 years of full NICs are required for the full SP. I claimed my SP in Nov 21, having stopped work for health reasons in 2012 by which time I had accrued 41 years of NICs - never contracted out. I now find I need to pay 5 years more (just over £4k) to achieve the best SP - and still £13pw short of the maximum. Presumably the 35 years must include the 5 years immediately preceding pension age? So, I will have paid 46 years!
And another thing - if you can speak to DWP on a freephone number, why can’t you with HMRC. Rant over.

molerat

Why oh why does all ‘official’ guidance - Gov.UK, CAB, Age UK etc - quote that 35 years of full NICs are required for the full SP.

It doesn't.  They all give caveats to that 35 years statement

Gov.uk states

You did not make National Insurance contributions or get National Insurance credits before 6 April 2016

You’ll need 35 qualifying years to get the full new State Pension.

A much easier read than the bit that actually affects you

Valuing your National Insurance contributions and credits made before 6 April 2016

To not have the full new pension with 41 years you WERE contracted out.  If you were not you would have at least, if not more than, the full new pension.  The only reason for less with that number of years will be contracting out.  The reason why you can only add 5 years to your pension is because more pre 2016 years would be of no use to you, a maximum of 35 can be used, so only 2016-17 onwards are viable. A line was drawn at April 2016 and there are different rules and calculations for NI credits either side of it.

Nothing like an unfounded rant based on false suppositions

Marbles55

Hmm, okay, thanks. TBH the memory of ‘contractual’ details all those years ago is not great now! Just one more point of pedantry - assuming I was contracted out, why does my NICs record show all years as being full? Surely the contracted out years should show ‘not full’.

molerat

Marbles55 said:

Hmm, okay, thanks. TBH the memory of ‘contractual’ details all those years ago is not great now! Just one more point of pedantry - assuming I was contracted out, why does my NICs record show all years as being full? Surely the contracted out years should show ‘not full’.

A "full" year is for the basic pension, that accrues irrespective of status.  Contracted out is only from the additional state pension.

p00hsticks

Marbles55 said:

Hmm, okay, thanks. TBH the memory of ‘contractual’ details all those years ago is not great now! Just one more point of pedantry - assuming I was contracted out, why does my NICs record show all years as being full? Surely the contracted out years should show ‘not full’.

Years are either 'full' or 'not full' - whether you were in contracted in or out employment, or filled the year in by making voluntary contributions or getting NI credits via Child Benefit or other benefits makes no difference to that.
 
The difference between being contracted in or out prior to 2016 lies in the amount of additional state pension (SERPS/S2P) a person potentially accumulated.

Marbles55

Oh we live and learn. Cheers molerat. An invaluable forum.

gsw55

I will be intrigued to know how long it takes for your payment to materialise as physical cash in your pension. I made all the necessary checks and made a payment to HMRC in January 2022. After waiting the recommended 3 weeks I checked the payment had been processed and asked DWP to make the transfer( it’s not automatic) to the relevant team. 14 months later I am still waiting for the update to be applied to my pension despite numerous call to future pensions call centre. 

molerat

gsw55 said:

I will be intrigued to know how long it takes for your payment to materialise as physical cash in your pension. I made all the necessary checks and made a payment to HMRC in January 2022. After waiting the recommended 3 weeks I checked the payment had been processed and asked DWP to make the transfer( it’s not automatic) to the relevant team. 14 months later I am still waiting for the update to be applied to my pension despite numerous call to future pensions call centre. 

You have already reached state pension age ?

If so write to your MP, DWP act pretty swiftly when they get a prod from that direction.

xylophone

21, having stopped work for health reasons in 2012 by which time I had accrued 41 years of NICs - never contracted out.

Were you a member of a Defined Benefit occupational pension scheme between 1978 and 2016?