Boost your pension
Checking you’ve plugged the gaps on your NI contributions could help, says Paul Lewis.
You may be able to boost your state pension by filling old gaps in your National Insurance record – but do it soon, as the rules change on 6 April. A gap in your contributions record can mean you get a smaller state pension when you reach pension age. Normally you need 35 years of contributions to get a full pension, and most people manage that at work. But if you have too many gaps for education or caring or looking after your home then it may be worthwhile to fill the gaps now.
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Until 5 April any gaps can be filled right back to 2006/07 – normally you can only go back six years. If you have too few contri[1]butions for a full state pension then each missing year you fill will boost your state pension by £328.64 a year index-linked, at a cost of £824.20. So the payback period is about 2.5 years if you don’t pay tax, and just over three or four years if you do.
STEP 1 If you are under pension age, check if you will get a reduced pension. Search gov.uk for “state pension forecast”. If your pension will be less than the full £221.20 a week then it is worth filling gaps to get a bigger one. If you already get a new state pension you will know if it is less than the full amount, so go straight to the next step. But note that if you get the old state pension (men born before 6 April 1951; women born before 6 April 1953), it is too late to pay extra contributions now.
STEP 2 Search gov.uk for “check National Insurance record”. That will tell you where the gaps are and if filling them will boost your pension. It will also explain how to pay for the Class 3 voluntary contributions to fill the gaps (or the cheaper Class 2 contributions if you were self-employed). The easiest way to do both steps, and pay, is to download the HMRC app to your mobile – search gov.uk for “HMRC app”. Or you can do it all by letter – details on those gov.uk pages. But however you do it, act soon, as the specially extended window closes in a couple of months’ time.
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