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Topping up NI Contributions

Topping up NI Contributions

Old Feb 6th 2021, 8:30 pm
  #31  
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Default Re: Topping up NI Contributions

Yep - I can log on, enter the 12 character gov id in there then get asked NI number and DOB - all good. Then a screen that says they cant identify me and need more info like passport info or credit info. I check those boxes. next screen is to then enter a UK address - I cant get past that.
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Old Feb 6th 2021, 8:45 pm
  #32  
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Default Re: Topping up NI Contributions

Write them an old-fashioned letter. Put it an envelope and post it. Strange to think we used to do that all the time.

It is National Insurance at Longbenton, Newcastle, that you need to contact.

Some people report success from phoning them

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Old Feb 6th 2021, 8:58 pm
  #33  
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Default Re: Topping up NI Contributions

Originally Posted by scot47
Write them an old-fashioned letter. Put it an envelope and post it. Strange to think we used to do that all the time.

It is National Insurance at Longbenton, Newcastle, that you need to contact.

Some people report success from phoning them
By coincidence I just threw away a load of NI correspondence because I am now in receipt of my OAP and 10 years I was writing to them from Texas to set up my voluntary NI contributions. Worked just fine.
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Old Feb 6th 2021, 9:03 pm
  #34  
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Default Re: Topping up NI Contributions

Originally Posted by freerskier
Yep - I can log on, enter the 12 character gov id in there then get asked NI number and DOB - all good. Then a screen that says they cant identify me and need more info like passport info or credit info. I check those boxes. next screen is to then enter a UK address - I cant get past that.
Ok, thanks.

I would surmise that there is something amiss with with the Gateway identification process setup for your account.

Did you get a verification email from gov.uk after initial application?

That should have given you a link to verify that you are indeed you and to set a password for your Gateway account.

Check 'junk/spam' whatever mail folders for that mail.

Without setting the password, you're effectively "sunk".

When I log in I just get "Gateway ID" and "Password" fields, no NI, DOB or any other question stuff before moving on to phase two authentication, which is stored.
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Old Feb 6th 2021, 9:12 pm
  #35  
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Default Re: Topping up NI Contributions

Originally Posted by freerskier
Yep - I can log on, enter the 12 character gov id in there then get asked NI number and DOB - all good. Then a screen that says they cant identify me and need more info like passport info or credit info. I check those boxes. next screen is to then enter a UK address - I cant get past that.
Have you tried entering you last UK address? Presuming you have lived there at some time.
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Old Feb 6th 2021, 10:05 pm
  #36  
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Default Re: Topping up NI Contributions

Originally Posted by chawkins99
Have you tried entering you last UK address? Presuming you have lived there at some time.
Great Tip!!!!!!! That did it. Juts need to dig out my passport now as it gets into the other screens. Thanks so much.
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Old Feb 6th 2021, 10:30 pm
  #37  
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Default Re: Topping up NI Contributions


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Old Jun 4th 2021, 5:37 pm
  #38  
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Default Re: Topping up NI Contributions

Well its been a couple of months or 3 and I got the letter back from HMRC with the table showing 8 years and what the Class 3 amounts that I could owe. - there lies the rub. More later.

It does state that I have 33 years and am 2 years shy of the full 35. I've called HMRC twice and got through really easily but both times they said they cannot say what I should pay and to contact the Future Pensions Service to get the exact amount. I questioned that surely with 33 years I have 2 years. It was only on the second call that, similar to some of your experiences, the helpful HMRC associate advised that it could be more as I was in an employer contracted out scheme from 1990 to1996. I need to call FPS for the exact amount - calling FPS is another story: Ive never got through. In this 2nd call the associate advised that at the moment I would get now would be GBP145 per week with the current full pension being GBP179.60 AND each additional "back" year I pay adds GBP5 per week to my pension.

So my maths/investing dilemma has come down to ones described here and in other threads. At Class 3 I would be paying GBP795 (but see below as some years I owe are less) for each year to add GBP5 per week or GBP260 per year to my pension. So to get GBP795 BACK in would take around 3 years - well a little more when you factor that pensions payments would be taxed.

The associate, in his experience, reckoned I could pay now the 3 'cheaper' years quoted in the table to gain GBP15 per week making the pension around GBP160 p/w. The 3 cheaper years on the table are GBP504.60 + 761.80 + 780 = GBP2046.40. He thought I did owe at least the 3 years but it could be more - contact the FPS etc etc etc. Put in 'investment' terms a GBP2046 investment returns me GBP260 per year and that 2046 is "paid back" in around 7.8 years - not including tax or around a 12% "return" per yer on the "investment" - so, on the face of it that sounds OK, eh?

1) I'll probably retire in 8 - 10 years at age 65 to 67
2) As I cant get through to FPS has anyone had a valid stab at calculating how may additional years you have to repay per year you were in a contracted out scheme as one idea - if its worth it - is to deliberately slightly overpay.
3) To pay the rates quoted in their letter I need to do all this by next Friday! ..Or the amounts per year go up to around GBP800 per year

As a side note I intended to pay any back years by DD so completed this section on the CF83 form. The associate said you can only pay future years by DD not years from the past you are repaying.

Look, I know this is long and winding and that, on review, there's a fair amount of me working my situation out in the post - I could have made it a lot shorter by quoting a few figures and just saying "Hey guys, whadyareckon!". So, again any help and insight as I'm in the weeds etc appreciated as I am beginning to loose feeling in my fingers tapping the numbers into my calculator.

Last edited by freerskier; Jun 4th 2021 at 5:42 pm.
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Old Jun 4th 2021, 6:05 pm
  #39  
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Default Re: Topping up NI Contributions

Yes, you do have have to pay past years with a bank transfer or check, and yes, future years can be paid using DD.

Depending on long you live a 3 year payback is still pretty good, it’s all profit from age 70 onwards, apart from the tax calculation.

since you are 10 years away to age 67(?) and already have 33 years paid why not wait 8 years and decide on whether or not you want to pay those extra 2 years since you will have a good idea what tax band you will be in. If you are in the 40% band then that makes the payback a lot longer on your £1,600 pound investment. But what are you going to do with that £1,600? Can you invest it better, bearing in mind that any income on it will also be taxed?
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Old Jun 4th 2021, 6:12 pm
  #40  
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Default Re: Topping up NI Contributions

You say paying £2,046 returns £260 ... but £2,046 is for 3 years, so it returns £260 x 3 = £780. It pays back in 2.6 years, or longer if the £780 is taxed.
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Old Jun 4th 2021, 6:14 pm
  #41  
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Default Re: Topping up NI Contributions

Thanks tdrinker - I see the error of my ways there. More tea needed!
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Old Jun 4th 2021, 6:38 pm
  #42  
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Default Re: Topping up NI Contributions

Originally Posted by durham_lad
Yes, you do have have to pay past years with a bank transfer or check, and yes, future years can be paid using DD.

Depending on long you live a 3 year payback is still pretty good, it’s all profit from age 70 onwards, apart from the tax calculation.

since you are 10 years away to age 67(?) and already have 33 years paid why not wait 8 years and decide on whether or not you want to pay those extra 2 years since you will have a good idea what tax band you will be in. If you are in the 40% band then that makes the payback a lot longer on your £1,600 pound investment. But what are you going to do with that £1,600? Can you invest it better, bearing in mind that any income on it will also be taxed?
Yeah, good point - at my current rate I'll be in the lower, general tax band unless one of my seriously overlooked songs and my 2 as yet unwritten but bestseller books hit the shelves. Also though the amount you pay for back years goes up the more you delay - if I wait a couple of weeks one of the GBP795 years goes to GBP800 - ok only a fiver ...But/Plus, there are time limits on when you can pay each specific years back NI. For instance on my letter I have until April 5, 2023 to pay the NI for 2009-10. Its all terribly good fun.

But as you say if it is just 2 years (I think with my 1990 - 96 contracted out period its more likely around 4 but only the unreachable FPS can give me an exact quote) GBP1600 or around US$2200 at, say, 5% in an ETF for 10 yrs is US$3500/GBP2600 or so = minus tax 'o course. I guess Id have to pitch this against what the state pension being index linked could go up by. Its a bit of a conundrum on how it all could work out.
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Old Jun 4th 2021, 6:41 pm
  #43  
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Default Re: Topping up NI Contributions

If you get £260 for a class 3 contribution of £795, it pays back in 2.6 years (795 / 260).

If you pay 40% marginal tax, it pays back in 5 years (795 / (260 - 40%) = 795 / 156). It's still a good return based on average life expectancy.

One option is to buy the extra years now, taking advantage of the lower contribution rates and eliminating the risk of future changes in the rules. Or, as Durham Lad says, wait until you're close to retirement, and decide based on your circumstances at that time. You can't know for sure the best option.

As you were contracted out from 1990 to 1996 it's likely you need more than 35 years' contributions for a full pension. Not many more, 1-3 years probably, but you really need HMRC to tell you. It's a shame you can't see your record online, because that would show it.

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Old Jun 4th 2021, 6:55 pm
  #44  
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Default Re: Topping up NI Contributions

I can see my record but it states the 33 years paid 2 years to go. But, on chatting with the good burghers of the HMRC they advised to get the full 35 years I need to pay more than 35 years to make up for the years I was in a contracted out pension from 1990 - 96.

Last edited by freerskier; Jun 4th 2021 at 7:06 pm.
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Old Jun 4th 2021, 7:07 pm
  #45  
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Default Re: Topping up NI Contributions

The online record should tell you how many more years you need to contribute for as full pension, taking account of contracting out. Otherwise HMRC should tell you, but they are saying you need more years but not how many. Why they can't simply look up you record and clarify is unknown.
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