Will I get any pension at all? Is it worth buying NI contributions for someone living abroad?

Alex9270

Hi, I'm a 53 yo italian guy.

I lived and worked in UK from 1999 to 2007 and then back again in 2009.

I had 11 qualifying years when I left for good the UK in 2009.

Since then I've been living in Spain.

I never paid any contributions in Italy and Spain. Only in UK. This is why I opted to buy voluntary NI contributions. At the moment I have a total of 25 qualifying years (the previous 11+14 NI voluntary contributions bought). 

My questions are:

1) am I doing right by buying NI voluntary contributions? Some have tried to discourage me to do it mainly because of the Brexit that may possibly change rules for people who moved abroad. According to them I may get no Pension at all in return. This is pretty scaring to me and I would need some reassurances.

2) I read somewhere in your page that a maximum of 16 years can be bought. As I said, I bought 14 years so far. So should I stop after buying the next 2 (my next ones are due for tax year 2021 to 2022 and 2022 to 2023)? In this case I would reach a total of only 27 qualifying years that is quite far away from the 35 needed to get the Full State Pension. 

3) In case I'm allowed to buy the next 10 years in order to reach 35 years of contributions, should I stop then or may I pay further years?

4) In case I'm doing it wrong and I have no right to get any pension at all, is there any chance to get the money back for the 14 voluntary NI contributions I paid or I just lost all my money?

Thank you everybody for your help!

Suzycoll

Hi Alex - to my knowledge

1....total personal choice. But be aware that if you claim your UK state pension from overseas it may not increase every year (as it does in the UK). It will also subject to the currency rates at the time when it is paid every month? I assume you can claim at 67 years old ? and yes the rules may change by then. Although I'm guessing that if you paid NI contributions in the UK will have to pay out 

2/3.....not sure about this sorry

4.....no you cannot get back what you paid in 

You may need to take the telephone number of the international pension centre that deals with paying out UK State Pensions overseas

International Pension Centre

Telephone: +44 (0) 191 218 7777
Textphone: +44 (0) 191 218 7280
British Sign Language (BSL) video relay service if you’re on a computer - find out how to use the service on mobile or tablet
Monday to Friday, 8am to 6pm

xylophone

Have you obtained a state pension forecast?

https://www.gov.uk/check-state-pension

What exactly does it show?

See also

https://www.gov.uk/national-insurance-if-you-go-abroad

But be aware that if you claim your UK state pension from overseas it may not increase every year (as it does in the UK). 

See

https://www.litrg.org.uk/tax-guides/pensioners/what-happens-if-i-retire-abroad#:~:text=You can find a list,months or more each year.

molerat

Some have tried to discourage me to do it mainly because of the Brexit that may possibly change rules for people who moved abroad. According to them I may get no Pension at all in return.

Absolute rubbish, you will not lose what you have already paid for.

read somewhere in your page that a maximum of 16 years can be bought

That was likely in 2022 and was the maximum number of back years that were available to buy, 2006-07 to 2021-22, you can buy as many as necessary

In case I'm allowed to buy the next 10 years in order to reach 35 years of contributions, should I stop then or may I pay further years?

35 years is of no relevance to anyone with a pre 2016 history.  How many more years you need depends on what your forecast states.

In case I'm doing it wrong and I have no right to get any pension at all, is there any chance to get the money back for the 14 voluntary NI contributions I paid or I just lost all my money?

No you can't get it back but you have not lost anything, you will get what you are entitled to.

Post up exactly what your forecast shows and someone will talk you through it

Current weekly £££.pp amount accrued up to April 2022 (or 2023 as some have been updated)
Number of pre April 2016 NI years full
Number of post April 2016 NI years full
Tax year you reach state retirement
Any COPE amount shown, in a click link in "You've been in a contracted-out pension scheme" if there is one.
Years which show not full.

NickBFS

On the Brexit issue, my understanding is that, since you worked in the UK while the UK was still a member of the EU, your pension rights will be protected by the UK-EU Withdrawal Agreement. This means, in particular, that not only would you not lose your pension rights but, in addition, AIUI, your pension should increase every year in the same way as if you were in the UK. In any event, I believe that Spain and Italy (and the EEA more generally) are among the countries where you can live and still benefit from yearly state pension increases, independently of the Withdrawal Agreement.

On paying voluntary NI contributions after leaving the UK, see official info at https://www.gov.uk/government/publications/social-security-abroad-ni38/guidance-on-social-security-abroad-ni38 on when you are eligible to do so to top up your state pension. Since you contributed in the UK for 11 years, my understanding is that you are eligible.

pinnks

NickBFS,

That is correct.  Anyone who had time in the UK as an EU citizen, or in an EU country as a Brit, but had left that other country before 31 December 2020 is protected both in terms of years contributed before Brexit and after, i.e. the EU rules on pensions continue as if we were still a member state.  If memory serves, this is covered in Article 32 of the Withdrawal Agreement.

You are also correct about the annual uprating for people drawing their UK pension while living in the EU/EEA.

In terms of paying voluntary NI, the OP should be able to pay Class 2 as long as they were working in the UK until they left and also working abroad during each year they wish to buy.  Class 2 is a gift at £164 (ish) per year, to add £302 per year to your pension.  Yes, payback is about 6 months into claiming your pension!  You will need to send form CF83 to HMRC (see NI38), selecting Class 2, ticking box 25 to say you want to fill gaps as well as future years, leave the bank details blank and in your covering letter say you will consider Class 3 if you do not qualify for Class 3.  As long as HMRC has that form before 5 April 2025 you are protected from the 2025 deadline.  But, as it is taking the best part of a year for HMRC to deal with those forms, I would not delay - even when they reply you are under no obligation to pay any, or all, of the years as this is all voluntary. 

Alex9270

I would like to thanks everybody for each reply given to my post. To Xylophone and Molerat....My State Pension forecast dated 31 March 2021 was showing the following details (please see below). However, at that time I only had the 11 qualifying years earned while working in UK. I bought the 14 NI voluntary contributions between May 2021 and 2022. So I guess that my updated State Pension forecast should show something different. 

State Pension forecast - 31 March 2021
- You can get your State Pension on February 2037
- Your forecast is £139.76 a week (£607.71 a month, £7292.48 a year)
- Estimate based on your NI record up to 5 April 2020 is £59.67 a week
- Forecast if you contribute until 5 April 2036 is £139.76 a week
- You can improve your forecast. You have gaps in your NI record that you can fill and make count towards your State Pension. The most you can improve your forecast to is £175.20 a week.

molerat

That forecast shows that it is possible for you to reach the full pension, £203.85 today.

I calculate your current amount to be £75.25 - updating £59.67 with the annual increases and adding the one extra year.

You need another 23 years to reach the max £203.85 but the 23rd will only give you pennies so 22 is the max viable. (Subject to £75.25 being accurate)

You have 12 years available going forward and until April 2024 to fill gaps between 2006-07 and 2017-18

Class 2 contributions should be viable which are £163.80 for each past year, each giving £274.56 annual pension.

It would be well worth getting another forecast https://www.gov.uk/check-state-pension

as well as your NI record https://www.gov.uk/check-national-insurance-record , you would need to do it separately if you do not have Government Gateway on line access.

All about paying NI whilst overseas  https://www.gov.uk/government/publications/social-security-abroad-ni38