There is good news if you have gaps in your National Insurance contributions record, as the Government has just given you extra time to fill
them – extending the deadline to pay missing contributions voluntarily until 31 July.
Going as far back as 2006/07, the concession applies to people who reached state pension age from April 2016 onwards. That means men born on – or after – 6 April 1951 and women born on – or after – 6 April 1953.
It’s not easy to work out if it’s worthwhile or not, but if your state pension – after it went up in April – is less than £203.85 a week then it may well be. And if you have fewer than 30 years of National Insurance contributions before 2016/17 and some of those gaps were in 2006/07 to 2015/16, then it is almost certainly worth doing. Even if you have slightly more than that – 31 to 34 years – it might be worth considering. This also applies if your total contributions cover fewer than 35 years. Then it probably makes sense to plug any gaps you have from 2016/17.
As an added complication, a separate set of rules means that if you paid into a good final-salary company pension before 2016, it will be important to top up from 2016/17 if you can. Of course, if you have worked or got credits for those years, then there is no point in paying for what you already have. The cost of filling the gaps is £824.20 per year although for 2020/21 and 2021/22 it’s slightly less. Each year you fill should give you an extra pension of around £5.80 a week – £302 a year – so the payback time for your extra contributions is quite short.
Alas, this opportunity only exists for younger pensioners and I am sorry the rules are so complicated! However, you can find out more from paullewismoney.blogspot.com – search “fill that gap” – as well as from gov.uk, keying in “voluntary national insurance”, which will help you see if it’s worthwhile and how to pay. If you get stuck, call the Government’s Future Pension Centre on 0800 731 0175.