Increase Your State Pension Before 5 April 2025

In order to qualify for any state pension, you need to have been paying National Insurance (NI) for at least 10 qualifying years.  To qualify for the FULL amount of state pension, you’ll need to meet your NI contribution for  circa 35 qualifying years (subject to certain condition in some instances it may need to be more).  The current full state pension amount is £221.20 per week. 

However, if you haven’t paid enough, you can top up now by making voluntary NI contributions.  HMRC have extended the deadline to 5 April 2025 whereby you can pay any missing NI for the years from 2006 to 2016, so you’ll need to act now if you want to catch up on those years.  Usually you can only go back 6 years hence it’s important to act before 5 April 2025.

Martin Lewis has been pretty vocal in suggesting people do this and his recent post gives lots of guidance and examples. https://www.moneysavingexpert.com/savings/voluntary-national-insurance-contributions/

If you are aged between circa 40 to 73, we do recommend you check your National Insurance paid and top up if you have a shortfall.  You’ll need to do a state pension forecast which you can do via your government gateway, and if you aren’t forecasted to get the full £221.20 and there are gaps in your NI, you may be able to top up your contributions for any missed years.  The forecast will assume that you continue to work in the UK on the same basis until state retirement age.

WHAT YOU NEED TO DO

• Check your National Insurance history record for any gaps..

• Apply for your state pension forecast which needs to be done via your personal tax account through your government gateway.

• See if there are any gaps in your NI history and compare your weekly state pension to the current maximum £221.20 available.

• if you are already at state pension age or within circa 4 months, or missing records for periods when self-employed or abroad, you may not be able to use the online tool and may need to call HMRC directly.

• If you are significantly under the full qualifying years, consider how much it will cost for you to buy back those missing years, and the increase you will get on your state pension as a result.

• Consider if any NI gap will or can be filled by other means and NI credits such as further years of working, claiming Child Benefit - see more here

• Don’t forget to make the payment for your NI shortfall if you want to top up - you can do this via the state pension forecast on your gov.uk account or app, or call the appropriate HMRC team (listed on Martin Lewis’ article) but be mindful the line could be busy so you can request a callback.

• Weigh up what is best for you. It may not be suitable or necessary for everyone. By topping up a small amount now, you could benefit from a greater state pension later, which becomes more valuable the longer you live.

• if you decide to top up, you will need to make a lump-sum payment and instalments won’t be accepted so do consider cashflow and whether the benefit is worth a short term loss of savings v borrowing.

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