Filling in missing NI years to boost state pension

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  • Tom99
    Tom99 Posts: 5,371 Forumite
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    GunJack wrote: »
    Because if pre-2016 years are bought, the Apr 2016 comparison calculations need to be done again, i.e. the position as at Apr 2016 but with the additional pre-2016 years taken into account.


    But the new will add £4.70pw and the old £4.20pw so whilst you can flip from old to new I can't make out how you could flip from new to old.
  • GunJack
    GunJack Posts: 11,673 Forumite
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    Tom99 wrote: »
    But the new will add £4.70pw and the old £4.20pw so whilst you can flip from old to new I can't make out how you could flip from new to old.

    Forget the added post-2016 years for a moment, it's the starting amount as of 5 Apr 2016 (end of tax year 15/16) that will be recalculated. Then, the higher amount at that point in time, be it under old or new calculation) will have the post Apr-2016 (i.e. 16/17, 17/18, etc.) added. In other words, the starting amount will be re-baselined.
    ......Gettin' There, Wherever There is......

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  • Tom99
    Tom99 Posts: 5,371 Forumite
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    GunJack wrote: »
    Forget the added post-2016 years for a moment, it's the starting amount as of 5 Apr 2016 (end of tax year 15/16) that will be recalculated. Then, the higher amount at that point in time, be it under old or new calculation) will have the post Apr-2016 (i.e. 16/17, 17/18, etc.) added. In other words, the starting amount will be re-baselined.


    [FONT=Verdana, sans-serif]Yes the starting amount will be re-baselined but if you pay for a pre 2016 year you will add £4.70 pw to you new pension forecast as at April 2016 but only £4.20 pw to your old pension forecast.[/FONT]
    [FONT=Verdana, sans-serif]Therefore you cannot flip from the new basis being the higher of the two to the old basis being higher.[/FONT]
  • jamesd
    jamesd Posts: 26,103 Forumite
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    Tom99 wrote: »
    [Yes the starting amount will be re-baselined but if you pay for a pre 2016 year you will add £4.70 pw to you new pension forecast as at April 2016 but only £4.20 pw to your old pension forecast.
    There are contracted out years to consider. Old rules is unaltering 4.20 a year for up to 30 years plus the earnings-related portion but new rules is 4.70 a year for up to 35 years minus the deduction for being contracted out. In that situation the old rules can end up higher than the new.

    So the first key comparison is at 30 years: is old rules of 30 years of BSP plus earnings-related portion higher or lower than 30 years at new rate minus the deduction under those rules?

    This one looks fairly close to the margin. Certainly too close for me to be confident that it's new rules without also knowing the old rules numbers.
  • Tom99
    Tom99 Posts: 5,371 Forumite
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    jamesd wrote: »
    There are contracted out years to consider. Old rules is unaltering 4.20 a year for up to 30 years plus the earnings-related portion but new rules is 4.70 a year for up to 35 years minus the deduction for being contracted out. In that situation the old rules can end up higher than the new.

    So the first key comparison is at 30 years: is old rules of 30 years of BSP plus earnings-related portion higher or lower than 30 years at new rate minus the deduction under those rules?

    This one looks fairly close to the margin. Certainly too close for me to be confident that it's new rules without also knowing the old rules numbers.


    [FONT=Verdana, sans-serif]The added pension and COPE amounts are not going to alter and if you pay a missing pre 2016 year you will therefore add £4.70 to the new basis forecast and £4.20 to the old.[/FONT]
    [FONT=Verdana, sans-serif]If that is correct then if the new basis is already the higher of the two it will always be the higher, you could not flip from new to old.[/FONT]
  • jamesd
    jamesd Posts: 26,103 Forumite
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    I don't think that the reported COPE is the full new rules deduction.
  • Tom99
    Tom99 Posts: 5,371 Forumite
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    edited 4 July 2018 at 5:17PM
    jamesd wrote: »
    I don't think that the reported COPE is the full new rules deduction.


    Why would it not be? Presumably the contracted out period was only a few years which is why the new basis forecast is the higher.
  • molerat
    molerat Posts: 31,818 Forumite
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    edited 4 July 2018 at 5:35PM
    155.65 / 35 x 29 = 128.97 - 8.76 = 120.21 x 1.025 = 123.22 x 1.03 = £126.92


    My gateway pension amount is also 1p more than the calculation.
  • Iamadored
    Iamadored Posts: 32 Forumite
    OMG you have lost me. What specific information does the OP need to provide to enable you to determine whether the FPC has given him the correct advice?
  • Iamadored
    Iamadored Posts: 32 Forumite
    OP: Making voluntary NICs to maximise your wife's SP is a no brainer. It is a very good deal.

    The cost of plugging past gaps is due to go up in April 2019, so it is best that you do so this financial year.

    The FPC were set up specifically to help people avoid wasting their money paying Voluntary NICs that will not increase their SP.

    It is clearly a very complicated business, which is why you need expert advice. The FPC are the professionals.
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