Maximizing National Insurance: Filling Gaps, Securing Benefits

It's not uncommon to have gaps in your National Insurance record, and these can be caused by career breaks, time off work to raise children, self-employment, or living or working abroad. However, these gaps can affect your state pension, so it's important to take steps to fill them. The government has extended the deadline to fill in gaps in National Insurance contributions from April 2006 to April 2016, giving people more time to increase their State Pension entitlement. You can check your National Insurance record online or by requesting a printed statement, and you may be able to make voluntary contributions to fill any gaps. The cost of these contributions varies depending on your circumstances, and there are different types of contributions, such as Class 2 and Class 3, so it's important to seek advice to find out if you will benefit from plugging the gaps.

Check for gaps in your National Insurance record

Gaps in your National Insurance record can prevent you from qualifying for benefits and reduce your state pension. These gaps happen when not enough National Insurance contributions are made by you or your employer. Therefore, it is important to check for any gaps in your National Insurance record and fill them if possible.

You can check your National Insurance record online through your personal tax account or via the HMRC app. To do so, you will need a Government Gateway user ID and password. If you do not have a user ID, you can create one. You can also request a printed National Insurance statement online, by phone, or by writing to HMRC.

Your national insurance record can also be checked by obtaining a state pension forecast. This will show you if you are on track for the full state pension and any national insurance years that are incomplete. You can get a state pension forecast online or by contacting the Future Pension Centre.

If you discover any gaps in your National Insurance record, you may be able to fill them by making voluntary contributions.

Understand how gaps impact your State Pension

Gaps in your National Insurance record can prevent you from qualifying for benefits and the State Pension. To avoid this, it's important to regularly check your National Insurance position and take action if you find any gaps.

Your National Insurance record determines your entitlement to certain state benefits, with the State Pension being the most prevalent. The amount you'll receive upon retirement is dependent on the number of 'qualifying years' you've built up. As of 2024/2025, you need at least 10 qualifying years to receive the minimum State Pension, which is £221.20 per week, and 35 years for the maximum entitlement.

There are several reasons why you might have gaps in your National Insurance record, including:

• Unemployment or low earnings: You didn't earn enough to contribute.
• Self-employment: Exemptions, irregular income, payment delays, and limited access to employment benefits can lead to gaps.
• Missing NI number: You didn't provide your NI number to your employer, making it difficult to track contributions.
• Living or working abroad: You may become exempt from UK National Insurance and lose eligibility for certain benefits.
• Career breaks: Taking time off to care for loved ones, travelling, or other reasons can result in gaps.
• Relying on state benefits: Long-term reliance on benefits like Jobseeker's Allowance or Carer's Allowance can cause gaps if you're unable to contribute or earn credits.

If you identify gaps in your National Insurance record, there are ways to address them:

• Voluntary contributions: You can make voluntary contributions to fill gaps, but there are time limits. HMRC typically allows you to remedy gaps within six years of the end of the tax year in which the gap occurred.
• National Insurance credits: Certain scenarios, such as unemployment, statutory sick pay, caring for a family member, jury service, etc., may qualify you for NI credits that can be manually added to your record.

It's important to note that only full qualifying NI years count towards your State Pension. Additionally, consider seeking advice from a financial adviser or the Pension Service to understand if paying for extra National Insurance years will increase your State Pension entitlement.

Make voluntary contributions to fill gaps

Making voluntary contributions to your National Insurance (NI) record can be a way to increase your state pension. This is particularly relevant if you have gaps in your NI record due to periods of unemployment, self-employment, or time spent abroad.

To make voluntary contributions, you will need to get a reference number from HMRC. This is an 18-digit code that you will use when making your payment to ensure it is credited to the correct pension account. You can pay by Direct Debit or BACS, but the reference number is essential to ensure your payment is allocated correctly.

When considering whether to make voluntary contributions, it is important to assess your current situation. This includes understanding your state pension forecast, how many years you have left to contribute, your current work status, and whether you intend to continue working. These factors will influence whether making voluntary contributions is a worthwhile investment for you.

It is also important to be mindful of the eligibility of different years when making voluntary contributions. For example, one source mentions that for years prior to 2016, these contributions may not make a difference to your pension, depending on your age. Additionally, if you have more than 35 years of contributions by April 2016, there is no need to purchase any pre-2016 years as it won't increase your starting amount.

Another consideration is the cost of filling gaps in your NI record. The cost of each year's contribution will vary, with older years being cheaper. You can calculate whether it is worth contributing by considering your expected lifespan and the potential increase in your state pension. If you are close to reaching the full years of NI contributions, filling in the gaps may be a worthwhile investment.

In summary, making voluntary contributions to fill gaps in your NI record can be a way to boost your state pension, but it is important to carefully assess your individual circumstances and seek official advice where necessary to make an informed decision.

Deadlines and extensions for voluntary contributions

Deadlines for voluntary National Insurance contributions are usually set at 5 April each year. This is the deadline for filling gaps in contributions from the previous six years. For example, the deadline for making up for gaps in contributions for the 2023-2024 tax year is 5 April 2030.

However, the government has extended the deadline for voluntary contributions for the tax years 2016-2017 and 2017-2018 to 5 April 2025. This extension was announced on 12 June 2023 and applies to years that would otherwise have been out of time to pay after 5 April 2023, from the tax year 2006-2007 up to and including the tax year 2016-2017.

The deadline for voluntary contributions to make up for gaps between April 2006 and April 2016 has also been extended to 5 April 2025 for men born after 5 April 1951 and women born after 5 April 1953. After this date, individuals will only be able to pay voluntary contributions for the past six years.

It is important to note that voluntary contributions do not always increase an individual's State Pension entitlement. Therefore, it is recommended that individuals contact the Department for Work and Pensions (DWP) to check if paying voluntary contributions will benefit them before making payments to HM Revenue and Customs (HMRC).

Contact the Future Pension Centre for advice

Gaps in your National Insurance record can mean that you will not meet the required number of years of National Insurance contributions to get a State Pension or qualify for certain benefits. If you have gaps in your National Insurance record, you may be able to pay voluntary contributions to fill them. However, it is important to note that voluntary contributions do not always increase your State Pension.

To understand whether you can pay for gaps in your National Insurance record, you can contact the Future Pension Centre. An agent from the Future Pension Centre can advise you on your State Pension and whether you can pay for any gaps in your National Insurance record. They can also provide you with a state pension forecast.

The Future Pension Centre can be contacted by telephone, textphone, or a video relay service for British Sign Language users. The contact details are as follows:

• Telephone: 0800 731 0175
• Telephone from outside the UK: +44 (0)191 218 3600
• Welsh language telephone: 0800 731 0453
• Textphone: 0800 731 0176
• Textphone from outside the UK: +44 (0)191 218 2051
• Welsh language textphone: 0800 731 0456
• Relay UK (if you cannot hear or speak on the phone): 18001 then 0800 731 0175

The Future Pension Centre helpline is open Monday to Friday, from 8 am to 6 pm. You can also write to them at the following address:

The Pension Service

9 Mail Handling Site A

Wolverhampton

WV98 1LU

United Kingdom

Frequently asked questions