Deadline looms to pay £824 to boost State Pension by £5,500 | Personal Finance | Finance
Thousands are racing to beat a deadline to boost State Pension income by £5,500 through old age.
A huge section of the UK workforce, mainly women, can dramatically increase the pension they are entitled to by handing over cash to HMRC to cover any years they missed paying National Insurance contributions.
There are various reasons why people might have gaps in their records, including time spent abroad, low earnings periods, self-employment without contributions, or career breaks for childcare and family responsibilities.
This means they may not have amassed the 35 years of NI contributions needed to receive the maximum new state pension or the 30 years required for the lower basic state pension.
Currently, Britons can increase that State Pension payments by filling gaps in NI payments dating back to 2006, however this scheme is due to come to an end on April 5, 2025.
After the deadline passes, people will only be able to fill gaps from the previous six years.
It costs around £824 for each year of missing NI contributions which will add £330 a year to your pension – adding up to around £5,500 extra based on a typical lifespan
To date more than 10,000 payments worth £12.5million have been made to boost people’s state pension, according to figures from HM Revenue and Customs (HMRC).
Heather Suttie, 50, discovered she was short of three years’ worth of National Insurance contributions due to extended studies and time spent in Tanzania. She was prompted into action after seeing social media posts from Martin Lewis.
She said: “I realised I could pay to fill the gaps in my record going back to 2006 thanks to Martin Lewis, and that the extended deadline closes in April.”
She invested approximately £2,500 to purchase three years of mixed self-employed and employer contributions which helped her boost the amount she had and qualify for a full state pension.
“It only took around 30 minutes to check for NI gaps, work out if it was worth plugging them and sort it. It’s so worth it,” she said.
Mike Ambery, Retirement Savings Director at Standard Life, said: “After the deadline, you’ll only be able to plug gaps from 2019 onwards so there could be 13 years that you will lose the ability to buy back.
“Time moves fast and there’s now less than six months to go. Paying voluntary National Insurance contributions could make a difference in retirement, but it’s not right for everyone.”
Tom Francis, head of advice at Octopus Money, told GB News: “Purchasing extra NI years can be a great way to achieve a guaranteed boost in income every year after you retire.”
Those interested in checking their National Insurance record can visit here – https://www.gov.uk/check-
The online service may not be suitable for everyone, particularly those who were self-employed or lived abroad during the relevant period. Free advice is available through MoneyHelper on 0800 011 3797.
