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Do you lose all the money paid in NI (from UK)

Do you lose all the money paid in NI (from UK)

Old Jan 22nd 2018, 12:51 pm
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Default Do you lose all the money paid in NI (from UK)

I start work in Canada (BC) next month and am moving there indefinitely. I have worked and paid NI in the UK for 21 years (currently 37yrs old). When I get to retirement age will I be eligible to receive my UK pension? Or can I transfer my NI payments across to Canada? Do I have to keep paying voluntary contributions to maintain my pension or if I just stop paying do I lose it all? Thanks
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Old Jan 22nd 2018, 12:57 pm
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Default Re: Do you lose all the money paid in NI (from UK)

As of now, you can have your status evaluated to see what total amount of contributions would be needed for a pension, you subtract the amount paid in the UK and pay the rest from Canada. You can then claim your UK pension from wherever you may be, in some locations the pension is indexed for inflation. In some, including Canada, it's not. There are specialist firms who will sort it out for you for a reasonable fee e.g.

UK 2 Canada Pensions

It is anyone's guess what governments may do between now and the day when you want to collect.
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Old Jan 22nd 2018, 1:04 pm
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Default Re: Do you lose all the money paid in NI (from UK)

As I understand it, you will get a UK state pension based upon the NI contributions you've made. At 21 years it won't be a full state pension. You can check how much you are likely to get here: https://www.gov.uk/check-national-insurance-record . When you get your state pension in the UK, however much it is, you can still receive it in Canada. However unlike for UK residents, it won't be index linked to inflation so value will diminish over time.
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Old Jan 22nd 2018, 1:09 pm
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Default Re: Do you lose all the money paid in NI (from UK)

Originally Posted by Atlantic Xpat View Post
As I understand it, you will get a UK state pension based upon the NI contributions you've made. At 21 years it won't be a full state pension. You can check how much you are likely to get here: https://www.gov.uk/check-national-insurance-record . When you get your state pension in the UK, however much it is, you can still receive it in Canada. However unlike for UK residents, it won't be index linked to inflation so value will diminish over time.
There's some sort of rule change coming in April so it may be beneficial to get off one's bum if one seeks to make a claim.
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Old Jan 22nd 2018, 1:17 pm
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Default Re: Do you lose all the money paid in NI (from UK)

I have just spoken with both HMRC and with the Future Pensions Department and apparently I won't lose anything but would only get x amount for the contributions I have paid so far, but if I continue paying for another 12 years I would be eligible for the maximum of £159 ish per week once I reach retirement age. Interestingly the lady said that if I pay more than another 12 years worth of NI it wouldn't be worth it as I would already be eligible for the maximum so any extra payments would be for nothing! Are other people aware of this? Does NI in the UK automatically cease once you reach a certain number of years of payments?
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Old Jan 22nd 2018, 1:23 pm
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Default Re: Do you lose all the money paid in NI (from UK)

Originally Posted by Phaedru5 View Post
I have just spoken with both HMRC and with the Future Pensions Department and apparently I won't lose anything but would only get x amount for the contributions I have paid so far, but if I continue paying for another 12 years I would be eligible for the maximum of £159 ish per week once I reach retirement age. Interestingly the lady said that if I pay more than another 12 years worth of NI it wouldn't be worth it as I would already be eligible for the maximum so any extra payments would be for nothing! Are other people aware of this? Does NI in the UK automatically cease once you reach a certain number of years of payments?
Yes, everyone is aware and yes you only get the maximum, no matter how many more years than the maximum you pay as your NI is not to paying for your future state pension.
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Old Jan 22nd 2018, 1:36 pm
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Default Re: Do you lose all the money paid in NI (from UK)

Originally Posted by Phaedru5 View Post
I have just spoken with both HMRC and with the Future Pensions Department and apparently I won't lose anything but would only get x amount for the contributions I have paid so far, but if I continue paying for another 12 years I would be eligible for the maximum of £159 ish per week once I reach retirement age. Interestingly the lady said that if I pay more than another 12 years worth of NI it wouldn't be worth it as I would already be eligible for the maximum so any extra payments would be for nothing! Are other people aware of this? Does NI in the UK automatically cease once you reach a certain number of years of payments?
If you work in the UK NI doesn't stop until you reach retirement age. My parents both worked five years past the standard retirement age and didn't pay NI during those years.

If you are paying voluntary contributions you stop when you reach the number of required years for a full pension. This is what I am doing, with a few years still to go before I reach the required years of contributions for a "full" pension.

It is quite easily to deal with the DWP International unit in Newcastle and I wouldn't pay 5 beans to someone to "arrange" things for me.

As advised above, under the current rules, if you retire in Canada your pension will be fixed once you start claiming it i.e. you won't get the annual increases.
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Old Jan 22nd 2018, 1:38 pm
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Default Re: Do you lose all the money paid in NI (from UK)

Originally Posted by Pulaski View Post
If you work in the UK NI doesn't stop until you reach retirement age. My parents both worked five years past the standard retirement age and didn't pay NI during those years.

If you are paying voluntary contributions you stop when you reach the number of required years for a full pension. This is what I am doing, with a few years still to go.

It is quite easily to deal with the DWP International unit in Newcastle and I wouldn't pay 5 beans to someone to "arrange" things for me.

As advised above, under the current rules, if you retire in Canada you pension will be fixed once you start claiming it i.e. you won't get the annual increases.
Thanks, I am starting to understand this now. So I think I will register for Class 2 payments as its a tiny amount anyway and continue contributing for the net 12 years.
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Old Jan 22nd 2018, 1:41 pm
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Default Re: Do you lose all the money paid in NI (from UK)

Originally Posted by Phaedru5 View Post
Thanks, I am starting to understand this now. So I think I will register for Class 2 payments as its a tiny amount anyway and continue contributing for the net 12 years.
Good plan, that was exactly my thought, BUT it appears likely that Class 2 contributions will be discontinued after 2018. The alternative is Class 3, which is about five times as much (£715), which is still a "great" deal. ..... See the article linked in my signature below! (Third paragraph below the "And Fishermen ..." sub heading.)

Last edited by Pulaski; Jan 22nd 2018 at 2:01 pm.
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Old Jan 22nd 2018, 1:58 pm
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Default Re: Do you lose all the money paid in NI (from UK)

The new state pension will pay £164.35 a week from 6th April 2018 = £8597

As you need 35 years contributions, each year of contribution equates to £4.70 a week or £244 annually. Therefore you will need to live 3 years beyond your retirement date to gain from any additional contributions. e.g Retirement date is 67, to start gaining from each additional year of NI contributions you will need to live beyond 70. If you are healthy and expect to live the average age of 81 for men, then it makes sense. Although, if you have more than 30 years to go to retirement, the age when you can draw your State Pension may have move onto 70 or higher.
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Old Jan 22nd 2018, 4:15 pm
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Default Re: Do you lose all the money paid in NI (from UK)

Alternatively you can go up to 6 years without paying and then current rules allow you to pay 6 years backdated and then continue to pay for another 6 years to give you the 12 yearly payments you are looking for. I paid my 6 years back money and then continued to pay until I had my 30 years however they then hit us with the 35 year rule change so I am going to have to resurrect my payments again.
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Old Jan 22nd 2018, 4:43 pm
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Default Re: Do you lose all the money paid in NI (from UK)

I think I checked this last year, but I've not contributed for 13 years now so it's too late to buy back some of those missed years.
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Old Jan 22nd 2018, 4:52 pm
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Default Re: Do you lose all the money paid in NI (from UK)

Originally Posted by Atlantic Xpat View Post
I think I checked this last year, but I've not contributed for 13 years now so it's too late to buy back some of those missed years.
Just out interest, when does it become too late to contribute to your missed years to enable you to get the maximum if your not already eligble?
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Old Jan 22nd 2018, 5:48 pm
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Default Re: Do you lose all the money paid in NI (from UK)

Originally Posted by Paul_Shepherd View Post
Just out interest, when does it become too late to contribute to your missed years to enable you to get the maximum if your not already eligble?
Once you retire. Up to then you can make additional contributions.

Under certain circumstances payments can be made than go back more than the usual six years of arrears. This happened when they bumped up the requirement from 30 to 35 years to get a full pension. If you had been already contributing in recent years, but we're short of years people were allowed to buy additional years going further back than six years.
Originally Posted by glendem4 View Post
.... As you need 35 years contributions, each year of contribution equates to £4.70 a week or £244 annually. Therefore you will need to live 3 years beyond your retirement date to gain from any additional contributions. ....
That's at the Class 3 rate of £715. At the Class 2 rate of about £145, the payback period is only 7 months!

Last edited by Pulaski; Jan 22nd 2018 at 5:52 pm.
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Old Jan 22nd 2018, 6:43 pm
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Default Re: Do you lose all the money paid in NI (from UK)

Originally Posted by Pulaski View Post
If you are paying voluntary contributions you stop when you reach the number of required years for a full pension. This is what I am doing, with a few years still to go before I reach the required years of contributions for a "full" pension.
What is the no. of required years for full pension?

I am currently paying into Class 2 which will end in 2019 (yes, it has now been extended until March 2019) but I haven't decided if I should continue paying into a higher class once the Class 2 ends. So am I right to assume that if I stop paying after lets say accumulating 20 years I would still get some pension money at retirement even though it may not be the full amount of whatever the going rate is at the time.
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