Paying National Insurance Contribution 2 or 3

MrJustin123

Hello,

Please can you help me to understand the situation.

I moved to the UK 10th of May, 2014
Worked there with no breaks up until 10th of July, 2022
Moved out from the UK on the 11th of July, 2022 to Lithuania (a EU member)
Started new job in Lithuania on the 16th of July, 2022.

1) Please, can you help me to understand if I need to pay NIC1, or can I go straight to NIC3?

2) I cant seem to understand if I need to fill some papers and send it to the UK before starting paying. 

3) If I do pay NIC3, what's the procedure? Just send the money to the given account? 

Your knowledge on this would me much appreciated.

Thanks, Justinas 

molerat

https://www.gov.uk/government/publications/social-security-abroad-ni38

Class 2 is what you need to pay.  Everything you need to know is in the link.

MrJustin123

thank you. I finally received a response from HRMC. I applied for NIC2. They accepted my application, which is great news! I have 8 qualifying years.

However I'm slightly confused. 

They sent me a shortfall rates for every year since 2006 to 2014 (I moved to the UK in 2014). 

However I was under impression I was applying to pay from now on into the future.

So I would like to clarify:
1) if I actually need to pay for the shortfall?
2) I moved out from the UK in 2022 July. Do I need to cover that period by paying in £3.15 x number of weeks passed? 
3) Am I supposed to pay every year the the agreed rate? 

Many thanks, Justinas

pinnks

HMRC have erred in law - while years 2006/07 to 2023/24 can currently be paid voluntarily but those who meet the requirements, you cannot pay voluntary NI for periods before you first arrived in the UK.

Voluntary NI, at either class 2 or class 3 is wholly voluntary - you can pay, or not pay, as you choose - the fact that HMRC has sent a schedule (albeit inaccurate) of years you can pay, does not mean you are obligated to pay any of them.  And you will certainly want to keep an eye on your pension forecast to make sure that you stop paying voluntarily when you have reached the maximum possible state pension.

For the year during which you left the UK, you may already have paid sufficient in NI to make it a qualifying, or full, year for pension purposes, depending on your earnings during those first 3 1/2 months of the tax year.  The schedule should show you how much still needs to be paid for 2022/23 (if anything).  Alternatively, you NI record will show whether that year is full or not.

So, you can choose to pay any years 2014/15 to 2022/23 that are not already full and to then continue paying annually for 2023/24 onwards.  Given that you arrived in 2014, my guess would be that you will need 35 full years to achieve a full UK pension, assuming you are young enough to pay that many years before the end of the tax year that ends before you reach UK pension age but your pension forecast will confirm the position.

molerat

You don't have to pay anything.

So far you have 8 years which, as you were a late starter to the NI system will be worth £50.56.  To get a full £221.20 you need another 27 years.  You can pay past years or future years, the choice is yours.  When do you reach UK state retirement age ?

22-23 should be a part filled year - can you access your on line tax account and see how much they are quoting at class 3 rates so you can calculate the number of weeks short ?

Others will be along to explain how to pay going forward, there are several on here living overseas who do that.