Understanding your personal NI contributions has never been more important (Image: Getty)
When the government said it was extending a deadline which allows people to top up their , helplines were inundated.
The changes relate to the newer version of the introduced in 2016 – and savers have until April 5, 2025 to act.
To receive a full which is currently £203.85 a week, you’ll need 35 qualifying years of (NI) contributions.
Women are predominantly at risk of having these gaps in their NI contribution history if they have taken time out of the workplace, for example to raise a family or care for older relatives.
If you should have contributed during the years 2006 through to 2016 but did not, or did not put in enough, you can top up your NI contribution history by buying these back.
If you are over 73, your will be based on the old system so you do not need to worry about topping up your NI contributions.
You may not have given yours much thought. But even if you’ve only been putting away a small amount each month, your pension fund could be worth thousands of pounds; especially if you’ve been putting something aside for 10 years or more.
Pensions can be one of the biggest financial assets you own. If you have been paying into a company-run pension, where your company matches or tops up your contributions, then the amount could run into over a hundred thousand pounds. If you are lucky enough to be in a final salary scheme, it could be worth even more.
This is why you and your partner’s pensions should be included in any post-separation or divorce settlement.
Pensions only have to be split if you are married or in a civil partnership. If you are cohabiting, any agreement to split a pension will have to be a mutual one or part of a court settlement. This is where you may need to get legal advice.
Below, the Express looks at how you can top up the , who is exempt, and exactly how to top up your pension, with details of how much it might cost you.
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Do I need to top up my state pension? Am I exempt?
Topping up will cost you up to £824 per year, and you can fill in NI gaps of up to six years. That £824 will add about £300 a year to your pension, so you will need to live over three years after you get your to make it worth your while.
You can top up your NI using the page link or the page.
If you don’t top up your then you will get an amount proportionate to the number of years you have full NI contributions for, so if you have 30 years of National Insurance contributions, then you would get an amount worth 86 per cent of the full .
Heading: How to top up your personal or company pension
If you have a personal pension or one set up on your behalf by your company you can make extra contributions.
This applies to anyone in a defined contribution scheme, so if you have a final salary or defined contribution pensions then you may not need, or be able, to top up.
Many of these schemes, often dubbed DB schemes are not open to new savers so if your employer has set up a pension for you then chances are it will be a defined contribution scheme.
eparation and divorce are difficult enough, without having to worry about unravelling your finances, but there are ways to make it easier. Our guides take you through what happens to your pension when you split up…
How much does it cost and how do I top up my pension?
The new was introduced in 2016 and applies to all men born after April 5, 1951 and women born after April 5, 1953. If you were born after those dates, you may be eligible to buy back any years of missed NI contributions.
This regime allows people to buy back missed years of contributions dating back to 2006 at a typical cost of some £824 a year.
This might appear high but it means your will increase by £329 a year, so will pay itself back in less than three years.
If you live an average life expectancy, you could gain about £5,400 if you’re a man and £6,100 if you’re a woman for each year of missed NI contributions that are bought back.
Find out if you have any NI gaps by checking on the website.
Even if you have missing years you may still qualify for a full , you can find out whether you are entitled to one by using the .
Certain benefits automatically come with NI credits, so even though you were not working there will be no gaps in your NI contribution record.
If you were on child benefit or a grandparent looking after children, or on statutory sick pay, or you were unemployed and actively looking for work then your NI gaps may be covered.
This is also the case if you were on maternity, paternity or adoption pay.
If you were ‘contracted out’ of the additional , before the changed in 2016, then you will need to check whether topping up can help.
How to get the full state pension
You will need to check your personal record and find out whether you are able to buy back NI pension qualifying years by going online .
This will tell what you’ve paid, up to the start of the current tax year (6 April 2024)
Any National Insurance credits you’ve received, for example for years looking after young children
If gaps in contributions or credits mean some years do not count towards your (they are not ‘qualifying years’)
If you’ll benefit from paying voluntary contributions to fill any gaps
How your forecast will change if you decide to pay voluntary contributions
If you can pay voluntary contributions online and how much this will cost.
Before you start
You will need to sign in to your personal tax account using your Government Gateway user ID and password.
If you do not have a personal tax account:
You need a Government Gateway user ID and password to set up a personal tax account. If you do not already have a user ID, you can create one when you sign in for the first time.
You’ll need your National Insurance number or postcode and two of the following:
- A valid UK passport
- A UK photocard driving licence issued by the DVLA (or DVA in Northern Ireland)
- A payslip from the last 3 months or a P60 from your employer for the last tax year
- Details of a tax credit claim, if you made one
- Details from a Self Assessment tax return in the last 2 years, if you made one
- Information held on your credit record if you have one (such as loans, credit cards or mortgages)