Deferred pension impact on gap top up

Arazan

I’ve already deferred my state pension for 5 years, which has increased it by around 29%. I’ve now realized that I have a National Insurance (NI) gap of 10 years, and it will cost me about £8k to fill these gaps. I understand that filling the gaps will increase my state pension by approximately £3k per year, which seems like a sensible move.

My question is: When I fill these gaps, will my deferred pension increase of 29% still apply? Specifically, will it be based on my original pension (which had 25 years of contributions), or will it be recalculated based on the full 35 years once the gaps are filled? I’m wondering if paying for the gaps would replace my deferred pension altogether or if it would just increase the base pension amount, which would then be subject to the 29% deferral increase. Any insights would be appreciated.

Dazed_and_C0nfused

Arazan said:

I’ve already deferred my state pension for 5 years, which has increased it by around 29%. I’ve now realized that I have a National Insurance (NI) gap of 10 years, and it will cost me about £8k to fill these gaps. I understand that filling the gaps will increase my state pension by approximately £3k per year, which seems like a sensible move.

My question is: When I fill these gaps, will my deferred pension increase of 29% still apply? Specifically, will it be based on my original pension (which had 25 years of contributions), or will it be recalculated based on the full 35 years once the gaps are filled? I’m wondering if paying for the gaps would replace my deferred pension altogether or if it would just increase the base pension amount, which would then be subject to the 29% deferral increase. Any insights would be appreciated.

Why do you think 35 years is relevant to you?

Do you know what your original entitlement was and which tax year did that fall in?

Which years are the ones you have gaps?  Post 2016 years are the ones most likely to add value but nothing you have posted actually provides any information to show making additional contributions would be of any benefit to you.

They may do you just haven't explained why.  And your reference to 35 years suggests you don't understand the basic rules.

p00hsticks

To add to what Dazed and Confused says above, when buying additional years after State Pension age any increase generally applies from the point at which the payment is made. so I suspect that there would have to be some even more difficult calculations done in the case you describe to work out the result of you deferring for 5 years with x NI years and then buying additional years later on - the extra years wouldn't be included for all the time you reached State Pension Age. 

These sort of recalculations once you have passed SPA apparently take many months for them to do.

squirrelpie

I think there was a recent thread about whether somebody could get the benefit backdated by delaying claiming their pension until after they had paid the extra contributions and waited until they had been processed. But I can't remember any details or whether I have even summarised the issue correctly.