NI Voluntary Contributions - Stuck in the middle

JayBeeCymru

I'm about to turn 46 and lived abroad for a while and was out of the job market so have about a 7 (1 partial) years gap.  I checked my record and my pension record is as follows

Before 2016 (Between 1993 and March 2016)
17 x full year contributions
1 x partial contribution (which I can top up)
4 x no contributions made (which I can top up)
2 x no contributions made (which I cannot top up)

After 2016 (April 2016 - Present)
4 x full year contributions
1 x partial contribution (which I can top up)
2 x no contributions made (which I can top up)

In summary

21 x years full contributions
1 x partial year contribution (which I can top up)
6 x no contributions made (which I can top up)

I am working full time and contributing to NI through PAYE.  I don't see any changes to my circumstances going forward and have no known health issues that might impact my ability to work. My pension age is calculated to be 21 years away (2044) if I retire at 67 and I only need another 14 full year contributions to have put in my 35 years.   

My question is should I buy at least 2 years of voluntary contributions while I can so that I have the option to retire at 60 (doubtful but desirable) or in case there's a change of circumstances such as caring for my parents or ill health?  Will I have enough of a buffer?  I know that people can't give me financial advice, I am just wondering what people's thoughts are?

Thanks

JayBeeCymru

Apologies - This should read:

Before 2016 (Between 1993 and March 2016)
17 x full year contributions
4 x no contributions made (which I can top up)
2 x no contributions made (which I cannot top up)

Qyburn

One thing to consider is how long these will be available, if you don't choose to fill any of these gaps then will you lose the option?

molerat

You have not given the important information which is your current amount up to April 2022 (or 2023) and any COPE amount in your forecast.  35 years is of no relevance to you with a pre 2016 history.  Which FY do you reach state retirement 43-44 or 44-45 ?

WillowCat

If you needed to give up work to either care for elderly parents, or because you yourself were in ill health, you'd likely be entitled to class 1 NI credits.  To get credits for caring you'd need to receive carer's allowance, for which the person you care for would need to be claiming a qualifying disability benefit (attendance allowance or daily living component of personal independence payment).  To get credits for ill health you'd need to claim New Style Employment and support allowance.

Dazed_and_C0nfused

 if I retire at 67 and I only need another 14 full year contributions to have put in my 35 years.  

Why do you think that that is important?

seatbeltnoob

Qyburn said:

One thing to consider is how long these will be available, if you don't choose to fill any of these gaps then will you lose the option?

I have 6 years I can plug up. Interestingly I have a few yeasrs of contributions where I didn't actually pay any NI. Just got NI credits because I was earning the lower earning limit through PAYE in my own business. SO it does feel like a bit of a kick in the teeth to pay £800 to plug 1 years gap.

I too would like to know how long these oppostuntity will be around. Because I just dont have that money lying around to pay £800 per year. But I can pay £800 a year (oldest one first) to fill up the gaps/.

seatbeltnoob

Does anyone know the steps you need to take to actually pay the gaps in NI? I follow the links and I come across a dead end where I have to call hmrc. Why cant they just take payments by card.

p00hsticks

seatbeltnoob said:

Qyburn said:

One thing to consider is how long these will be available, if you don't choose to fill any of these gaps then will you lose the option?

I too would like to know how long these oppostuntity will be around. Because I just dont have that money lying around to pay £800 per year. But I can pay £800 a year (oldest one first) to fill up the gaps/.

You can always pay back the last six years - the price of the most recent last two remain as they were when current and those further back cost the same as the current year. The price of each year increases with inflation each year - usually at the start of the new tax year but this year it has been held until the end of July. So currently 2020-21 is £795.60, 2021-22 is £800.80 and 2022-23 and all other available years £824.20. 

Since the introduction of the new State Pension in April 2016 there has also been a temporary extension that allows you to buy years back as far as 2006-7, but this closes at the end of July this yar (the deadline extended from April due to the high demand).

 So after then only 2017-18 and later will be available to purchase. 2021-22 and 2022-23 will remain at the same prices as now but the price of other available years will rise to £907.40, the same as for the current year 2023-24

p00hsticks

seatbeltnoob said:

Does anyone know the steps you need to take to actually pay the gaps in NI? I follow the links and I come across a dead end where I have to call hmrc. Why cant they just take payments by card.

Because without speaking to you they won;t know which years the payments relate to. 

You need to speak to the Future Pensions Centre first to confirm that buying the years you have unfilled will actually increase your pension forecast as not all will, especially those pre-2016. 
Contact the Future Pension Centre - GOV.UK (www.gov.uk)

Having established which years to buy you then need to contact HMRC to tell them and get a reference number to enable you to make the payment and for HMRC to link the payment to the requested years. 
National Insurance: general enquiries - GOV.UK (www.gov.uk)
(Apparently the Future Pensions Centre can sometimes transfer you directly across to HMRC).

The alternative method if you are confident which years you want to buy is cheque by post with covering letter. 
Pay voluntary Class 3 National Insurance: By cheque through the post - GOV.UK (www.gov.uk)
If you post up the details from your forecast here,  people will be able to help you decide which years it is best to buy. 

molerat

seatbeltnoob said:

I too would like to know how long these oppostuntity will be around. Because I just dont have that money lying around to pay £800 per year. But I can pay £800 a year (oldest one first) to fill up the gaps/.

That one is quite straightforward.  Years stay at the original price until 2 years after the end of the year.  They then increase in price to the current year price and increase each year in line with that until 6 years after the end of the year when they cease to be available.  A special dispensation was brought in with the introduction of the new pension where years 2006-07 to 2015-16 were treated for timeline purposes as if they were 2016-17, staying at a special price until April 2019 then increasing in price each year until they cease to be available in April 2023 which has been extended to 31 July 2023.