Cheapest way to Improve Your NI Record

reidmj

The cheapest way to improve your NI record is to go self-employed. If you've left fulltime employment and need to improve your NI record then signup as self employed. If you earn under £1000 you do not pay any tax and you can opt to pay voluntary Class 2 NI contributions. For year 2023/2024 it cost me just £176 to get a full years record, far cheaper than buying missing earlier years. 

p00hsticks

Cheap, but not the 'cheapest'.
If you can look after grandkids etc while parents work you can get Specified Adult Childcare credits - they'd cost you nothing. 
Apply for Specified Adult Childcare credits - GOV.UK

SimonFF

reidmj said:

If you earn under £1000 you do not pay any tax and you can opt to pay voluntary Class 2 NI contributions. For year 2023/2024 it cost me just £176 to get a full years record, far cheaper than buying missing earlier years. 

How does this magic happen?

Silvertabby

I bought 4 years of Voluntary NI, which were a HUGE bargain even at Class 3 rates.

No grandchildren, and really couldn't be *rsed with the faff of selling a few bits on e-bay. 

QrizB

SimonFF said:

reidmj said:

If you earn under £1000 you do not pay any tax and you can opt to pay voluntary Class 2 NI contributions. For year 2023/2024 it cost me just £176 to get a full years record, far cheaper than buying missing earlier years. 

How does this magic happen?

Register as self-employed with HMRC, do some self-employed work, fill in your self-assessment tax return and tick the "voluntary Class 2 NI" box.

Keep proper records of your self-employment (expenditure, receipts, etc.) should they choose to audit you. Make sure you tell your various insurers that you're now self-employed in your occupation of choice. Buy public liability insurance.

I'm assuming here that the OP wasn't suggesting that you tell HMRC you're self-employed with no actual intention of trading, simply so you qualify for Class 2 NI. That would be tax fraud and against the rules of the board.

Silvertabby

QrizB said:

SimonFF said:

reidmj said:

If you earn under £1000 you do not pay any tax and you can opt to pay voluntary Class 2 NI contributions. For year 2023/2024 it cost me just £176 to get a full years record, far cheaper than buying missing earlier years. 

How does this magic happen?

Register as self-employed with HMRC, do some self-employed work, fill in your self-assessment tax return and tick the "voluntary Class 2 NI" box.

Keep proper records of your self-employment (expenditure, receipts, etc.) should they choose to audit you. Make sure you tell your various insurers that you're now self-employed in your occupation of choice. Buy public liability insurance.

I'm assuming here that the OP wasn't suggesting that you tell HMRC you're self-employed with not actual intention of trading, simply so you qualify for Class 2 NI. That would be tax fraud and against the rules of the board.

As I was saying......Not going through all that faff was worth the cost of 4 years at the Class 3 rate.

SimonFF

QrizB said:

SimonFF said:

reidmj said:

If you earn under £1000 you do not pay any tax and you can opt to pay voluntary Class 2 NI contributions. For year 2023/2024 it cost me just £176 to get a full years record, far cheaper than buying missing earlier years. 

How does this magic happen?

Register as self-employed with HMRC, do some self-employed work, fill in your self-assessment tax return and tick the "voluntary Class 2 NI" box.

Keep proper records of your self-employment (expenditure, receipts, etc.) should they choose to audit you. Make sure you tell your various insurers that you're now self-employed in your occupation of choice. Buy public liability insurance.

I'm assuming here that the OP wasn't suggesting that you tell HMRC you're self-employed with no actual intention of trading, simply so you qualify for Class 2 NI. That would be tax fraud and against the rules of the board.

Is class 2 cheaper than class 3?

I also thought that a part time job that pays £123 per week is enough to get a full year of NI. That means 11 hours a week. Or am I missing the point?

molerat

Class 3 over £900 class 2 under £200. The point is you don't have to do much actual work, certainly not 11 hours a week and definitely no boss on your case.

SimonFF

molerat said:

Class 3 over £900 class 2 under £200. The point is you don't have to do much actual work, certainly not 11 hours a week and definitely no boss on your case.

I have wasted my life!