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State Pension/NI payments when retired/unemployed/receiving a teachers pension

Discussion in 'Retirement' started by stopwatch, May 6, 2018.

  1. stopwatch

    stopwatch Established commenter

    As it says in the title; I have around 31 years State Pension payments (plus about 6 years part payments, which I believe count for nothing!).

    I want to ensure I pay up to the (currently) required 35 years before I get to 66 (I am just 61). Returning to UK end June to live - no more overseas work!

    What can I do to ensure my NI/State Pension payments continue up to the required 35 years? I believe there is a 'buy back' scheme which is expensive(?) I can register unemployed, so that the state pays the monthly amount - but I believe this is time consuming and I don't intend seeking work. Can I pay voluntarily from my pension income and if so,what class would it be and how much?

    Any information would be appreciated,particularly from anybody in a similar position. :)
     
  2. heldon

    heldon Occasional commenter

    I believe it costs about £770 to buy each year. I am going to use some of my lump sum to buy the years.
     
  3. stopwatch

    stopwatch Established commenter

    Not too bad. I think I will need about three and a half years = about £2700. Am I correct in thinking that you can only buy them back when they have passed eg you could now buy back the 2017/18 year?
     
  4. Sundaytrekker

    Sundaytrekker Star commenter

    Or you can work part time and earn qualifying years. You need to earn about £6000 a year or more to qualify.

    You cannot pay direct from your pension income as that is unearned income.

    Yes, I think you can only buy years back after they have passed.
     
    eljefeb90 and Lara mfl 05 like this.
  5. Lara mfl 05

    Lara mfl 05 Star commenter

    You really need to contact the Pensions People for A State Pension Statement. This will give you a long list of 'qualifying years' where 'no payment needed' or 'too late to make a payment. Some years you can 'buy back, but there is a time limit ad from memory anything older than 6 years is too late to pay back. I If you go to the Pensions website it gives information about this, I think it is Class III contributions and the amount will vary dependent on how much I any particular you've paid. From memory mine for one year was as little as £68 to make up to the required 26 weeks and another year, when I'd done very little supply was nearer £500.
    I'll try and find you the link.
     
    catbefriender and border_walker like this.
  6. phatsals

    phatsals Occasional commenter

    First of all look at your own personal NI account to check on your current entitlement. You can buy the years after they have passed, ie 17/18 etc. If you can get a role as an exam marker you can pay class 2 NIC - around £2.40pw, the same as when you work overseas, or you can pay the full £770 for each year.
     
  7. ikon66

    ikon66 Occasional commenter

    Does anyone know why I still won’t get max state pension even though it says I have 41 years of contributions. Says I still need to contribute until I’m 66 to get it???
     
  8. Lara mfl 05

    Lara mfl 05 Star commenter

    I'm guessing this is to do with your date of birth. The 35 years is the minimum number of years needed to qualify, but some people may well pay for more years if you started work at 16 and worked till 66 /67, the new current new pension age for most people, which would work out at 50 years. :eek:

    My particular school year has the biggest variations and all my friends have different pension ages depending on which month they were born, so anything from a friend born in Feb. qualifying at 63, yet my birthday in April means I had to wait tll 63 and 3 months and friends born in June had to wait till 63 and 6 months and so on.
     
  9. Lara mfl 05

    Lara mfl 05 Star commenter

  10. phatsals

    phatsals Occasional commenter

    The 35 years was always misleading, it depends on whether or not you were contracted out, not your age. Two calculations were carried out when the new Pension came in and your base amount would be the better of the 2. As you have already made 41 years contributions you would have a minimum of 30 years under the new system. You can continue to increase your entitlement up to the full 35 years providing you are under State Pension age.

    As you were contracted out and paid less NIC, that portion went into your TP. Under the old system you would be entitled to only the base £120ish regardless of how many years over 30 you paid. Under the new system you can increase your entitlement up to the current £160ish.
     
    Lara mfl 05 likes this.
  11. eljefeb90

    eljefeb90 Senior commenter

    I spoke to someone at HMRC regarding this threshold. He said that the qualifying year is calculated according to a weekly calculation, not an annual one. I earned between £6000 and £7000 a year, but it wasn't a steady amount per week, so I shall have many qualifying weeks but not a whole year. I hadn't been aware of this. Has anyone else had any experience of this rule? I shall phone up again in a few months to see where I stand
     
  12. Lara mfl 05

    Lara mfl 05 Star commenter

    Yes it is something to do with enough contributions, from memory 26 weeks, at the required amount. So on supply I often didn't earn enough in most weeks to 'qualify' for the year.

    You can try deferring your pension as every 9 weeks gives you an extra £1 of pension (under the current regulations). So 90 weeks deferment could 'lift the pension to £128 but if you only have a small TPS, still won't lift you to the 'new minimum pension' of £159. But this will probably be phased out at some point or need more deferred weeks to get that I suspect.
     
    eljefeb90 likes this.
  13. eljefeb90

    eljefeb90 Senior commenter

    Thanks @Lara mfl 05 . It's always a balance. It may be best to accrue years and fork out the £770 per year nearer to my state pension age of 66. My ISA is barely paying 0.5 % interest, so I would see a return after 3-4 years. From memory,your pension increases by £4.50 per week for every £770 you invest. Of course, rules can change and if I snuff it at 67, I'll be well annoyed!
     
    lindenlea likes this.
  14. border_walker

    border_walker Established commenter

    Because i work outside of teaching first, when I got mine it was virtually the same as the new state pension.
     
  15. ikon66

    ikon66 Occasional commenter

    Thank you all
     
    border_walker and Lara mfl 05 like this.
  16. Bedlam3

    Bedlam3 Lead commenter

    @stopwatch if you are married and your spouse has over 35 years I believe you can have these extra years. You'd need to check as I'm not sure how it works.
     
  17. Lara mfl 05

    Lara mfl 05 Star commenter

    I may be wrong, but my understanding was that with the changes everything was on a level playing field, married or not and everyone has to 'qualify in their own right' for a pension, on the basis of their own employment history.
    I take that to mean that a widow's pension would also be discontinued at some stage.
     
  18. Sundaytrekker

    Sundaytrekker Star commenter

    Same as Lara, I thought recent changes means everyone has to accrue their own NI record. There is no married couple’s entitlement now for new claimants, I believe.
     
  19. binaryhex

    binaryhex Lead commenter

    Everyone’s first step should be to jump through the long and drawn out hoops to get a government gateway account if you are looking into your state pension,

    http://www.gateway.gov.uk/

    You can then sign up for NI insurance services. That will enable you to log in and see exactly what contributions you have made since 16 year by year, what your pension forecast is if you make no further contributions, what it would be if you made further contributions, how to buy extra years and when you get your pension.

    It’s worth doing and is easy to understand. Getting an account takes between one and two weeks.
     
    Lara mfl 05 and border_walker like this.
  20. Bedlam3

    Bedlam3 Lead commenter

    Thank you . I hadn't been aware of this change.
     
    Lara mfl 05 likes this.

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