Paying back incomplete tax years, is it worth it?

jem1276

I have a letter from Jan 2004 asking if i want to pay back a total of £377.95 from 2 years of incomplete tax years and hubby has one from dec 2003 asking if he wants to pay back £290.40 from one year.

We have no spare money and would have to borrow to pay it and the deadline is friday! EEKKKK!

Should we borrow and pay back or leave it but regret it in the future?

Jem x

terryw

jem1276 wrote: »

I have a letter from Jan 2004 asking if i want to pay back a total of £377.95 from 2 years of incomplete tax years and hubby has one from dec 2003 asking if he wants to pay back £290.40 from one year.

We have no spare money and would have to borrow to pay it and the deadline is friday! EEKKKK!

Should we borrow and pay back or leave it but regret it in the future?

Jem x

I assume that this is NIC ....remember that under the new rule, most people will only require 30 years contributions for a full retirement pension. If you are likely to achieve this anyway, then it is probably not worth it anyway.

terryw

chappers

It all depends on how close you are to retirement and as terry says if you are going to make up your 30 years contributions.
The letter should say how much your pension is going to be based on your current shortfall.
If you think you are not going to make up the 30 years without this payment you then need to balance up how much pension you are going to lose over the amount of time you might live after retirement against the amount you need to pay. If you are close to retirement then yes this may be your last opertunity to top up to get full pension, if you are a way away you may get another oppotunity to top up any short fall later.

bobby-boy_2

If you have any childrem for whom you were receiving child benifit for during the shortfall years you will be credited with primary carers allowence for these years AS LONG AS it was for the complete year. Your local tax office can confirm this. This only applies to the primery name on the family allowence "book" as was.

Tao81

bobby-boy wrote: »

If you have any childrem for whom you were receiving child benifit for during the shortfall years you will be credited with primary carers allowence for these years AS LONG AS it was for the complete year. Your local tax office can confirm this. This only applies to the primery name on the family allowence "book" as was.

Not aware of primary carers allowance? Have you any suggestions on where I can educate myself regarding this...Thanks

bryanb

Remember the 30 year rule doesn't start till 2010, if you're very close to pension age.You still need 40+ till then.

bobby-boy_2

Hi Tao81 you can call HMRC about the allowence. I was on income support for a while and it is a non taxable allowence so when i querried my "Stamp" being paid the benefits agency said I was not entitled so I contacted Inland Revenue as was and they explained it. The first name on the book (usually) the mother gets carers allowence until the youngest child is 16 or leaves full time education. It has to be a full tax year but it protects your pension. Just give HMRC a call and they should confirm