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Paying National Insurance..

Discussion in 'Retirement' started by littlevanner, May 5, 2020.

  1. littlevanner

    littlevanner New commenter

    Complete Numpty question but when I retire in the Summer and receive my pension at 59, will I have to pay National Insurance on it ? Just trying to work out exactly how much I will get in my pocket each month - once the tax sorted out !
  2. diddydave

    diddydave Established commenter

  3. diddydave

    diddydave Established commenter

    Though, if you are short of 'years' to get the fullest state pension, you can pay voluntary NI contributions...at the moment there is a choice of 'cheap' ones (£3 a week) or 'expensive' ones (£13 a week)
  4. 50sman

    50sman Lead commenter

    The reason why you don’t pay NI on your pension is that you already paid it while you were working!
  5. littlevanner

    littlevanner New commenter

    Thank you
  6. littlevanner

    littlevanner New commenter

    I get it - just wondering if any part of NI payments went towards other things ...so you had to carry on paying if you were below pensionable age
  7. littlevanner

    littlevanner New commenter

    what do the cheap ones buy DD? :)
  8. diddydave

    diddydave Established commenter

    More than the expensive ones if the following page is anything to go by (Class 2 self-employed or Class 3 voluntary) - oh and I got the amounts slightly wrong:

    Class 2 get but Class 3 do not get:
    • Contribution-based Employment and Support Allowance
    • Maternity Allowance
    • Bereavement Support Payment
    Class 2 are £3.05 a week (more if you earn over a certain amount)
    Class 3 are £15.30 a week.

    The class 2 are available if you are self-employed, or several other types of person - including examiners and invigilators (which is normally of most interest to ex-teachers).

    Both 'buy' you the 'New State Pension' and each year of that is worth about £5 a WEEK up to the maximum. You won't get the State Pension though until you reach your NPA (67-68 etc).
    Last edited: May 5, 2020
    littlevanner likes this.
  9. lindenlea

    lindenlea Star commenter

    @littlevanner Not a numpty question at all. If you don't know, you don't know, so ask. There was a time when no one on here knew the answer to that question - not even @diddydave .:).
    littlevanner and diddydave like this.
  10. diddydave

    diddydave Established commenter

    Yes, I've always said that there are no stupid questions. Only an answer can confirm that diagnosis.
    littlevanner likes this.
  11. Sundaytrekker

    Sundaytrekker Star commenter

    My national insurance record is now up to date on gov.uk/personal tax account for 2019-2020. If you want to find out how many years you are credited with and how many more you need to contribute for a full record you’ll need to log in to yours.

    I don’t pay NI on my teachers pension but I do on my earned income when I go above certain thresholds. Despite having 43 years credited, due to the changes in rules around contracting out, I still need two more years for a full state pension. When it comes, it will be £175 a week. Worth having even if we WASPI women have had to wait longer than we originally thought.
    littlevanner likes this.
  12. PeterQuint

    PeterQuint Lead commenter

    The only stupid question is the one you never asked.
  13. asnac

    asnac Established commenter

    My understanding from the government website is that you can only pay voluntary contributions for those you missed in the last six years.

    It would be great for me if I'm wrong (am I, @diddydave ?), because I missed a lot of years way back and would have to keep working till I'm 67 to build up a full entitlement.
  14. phatsals

    phatsals Senior commenter

    You can pay for gaps going back to April 2006 at the moment, you would have until 2023 to pay for them. This is because under the new pension arrangements everyone must have their own entitlement with a minimum of 10 years contributions, not inherited from a spouse. If your gaps are pre-2006 it's now far too late.
    tuscanydays and asnac like this.
  15. diddydave

    diddydave Established commenter

    This is an area I have very little knowledge on - so I will probably only add a few signposts and more questions rather than any actual answers.

    I do recall something about pre 2016 contributions and whether these make much difference due to the way in which they were changed. So check whether filling any of those gaps is actually worth it before doing so.

    This page has details on paying for years more than 6 years ago (it is current, and I tend to believe Which can be trusted): https://www.which.co.uk/money/pensi...on/can-i-top-up-my-state-pension-an0q09p37nsj

    This page refers to whether it is worth filling up years prior to 2016: https://www.moneywise.co.uk/pension...shortfall-my-national-insurance-contributions

    Further, remember that 'working' is only one way that you can build up NI years...you could pay voluntary contributions without working...(and under the current rules if you did work as self-employed or as an examiner or invigilator could pay the cheaper version)
    asnac likes this.

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