As you may know, everyone must make approximately 35 years of National Insurance contributions to get a full state pension. If your NI record commenced before 6 April 2016, you might need to top up your record.
Address National Insurance gaps from the last 17 years
Normally you can only top up your NI contributions for the past six years. But right now there is an opportunity for UK residents to top up their contributions all the way back to 6 April 2006.
This opportunity is only open until 31 July 2023 – so now is the time to check your details.
You can view your National Insurance record on the government website. You will need your Government Gateway login details.
Aged 45 to 70? This applies to you
If you are aged between 45 and 70 it is important to check that you have, or expect to have, made sufficient National Insurance contributions to qualify for the full State Pension. If you’re under 45, you can still check, but it may not make financial sense to pay for any full years that are missing.
First, check whether you currently qualify for the full State Pension on the government website. The page will tell you whether you can improve your maximum pension or whether you’re already at the full entitlement of £203.85 per week. If so, you don’t need to do anything further.
If you aren’t at the maximum level and you have gaps in your National Insurance record, making voluntary contributions now could significantly boost the State Pension you receive in future. A full year’s NI payment is currently £824. It costs less to top up a partial year.
If you do have insufficient years, making that payment of £824 could benefit your State Pension by up to £5,500.
Check if you can claim credits
Before making any payments, check whether you are entitled to any free National Insurance credits. These may be available if any of the following apply to the missing/partial years on your NI record:
- You were on maternity allowance, carers allowance or jobseeker’s allowance
- You were receiving child benefit for a child under 12
- You were claiming Universal Credit
- You were employed and earning at least £6.396 a year
- You were self employed with profits of at least £6,725 a year
- You received working tax credits.
Check the full list of eligibility criteria.
How to make additional contributions
Contact the Future Pension Centre on 0800 731 0175 for specific details about your options and the cost of topping up.
If you decide you do want to make voluntary contributions, there’s information on how to pay on the GOV.UK website.
If you are already at state pension age, call the Pension Service on 0800 731 0469 before making any decisions. They will look at your records and confirm whether making voluntary contributions is recommended based on your personal circumstances.
Both phone lines are free and open between 8am and 6pm on Monday to Friday.
Need advice on managing tax and National Insurance? Let us help. As Lune Valley accountants we help with individual and small business tax management. Contact us today.