The amount of National Insurance contributions that you make over your ‘working’ life dictate how much state pension you will be entitled to when you retire.
There are times when contributions are missed during periods of not working for instance, and these result in gaps in your NI record. It is often worth making relatively small ‘Voluntary Contributions’ to top these up to a full year’s contribution value to increase the amount of state pension that you will receive.
The deadline to contribute for lost years from 2006 to 2016/17 was previously set at 5th April 2023. From 6th April 2023, only incomplete years from 2017/18 could be topped up.
However, after HMRC and DWP received a ‘surge in customer contact’, and much concern from members of the public, the Government has extended the cut-off date to 31st July 2023. Contribution rates for the voluntary NICs are set at the existing 2022/23 level until then.
If you have incomplete years dating between 2006 and 2022, it may be more effective to top up the older ones as you will lose the chance to after July 31st.
UHY Ross Brooke welcomes this news which will come as a relief to many who find it hard to contact DWP or HMRC for advice, or even to find the money to pay the top-up, and urges people to check their NI record for any mistakes or to see where they should top up. Please get in touch for more advice on National Insurance and tax efficient planning for your future.
- Taxpayers can check their National Insurance record
- Get a state pension forecast,
- decide whether making a voluntary National Insurance contribution is worthwhile
If you require further advice, then please get in contact with us.