Go Back  British Expats > Living & Moving Abroad > USA
Reload this Page >

Anyone retiring to the UK on Social security only

Anyone retiring to the UK on Social security only

Old Dec 14th 2014, 7:43 pm
  #1  
Forum Regular
Thread Starter
 
Joined: May 2013
Posts: 41
LindseyAnn is an unknown quantity at this point
Default Anyone retiring to the UK on Social security only

Is there anyone on here who has lived and worked primarily in the US and has virtually no National Insurance Contributions, but has returned to the UK and is living on their Social security payments?

I understand that the UK and US have the reciprocal agreement and everything. I have returned to the US and have only got 5 years NI contributions and have the required amount for SS payments. I am only 43 at present but am thinking that I would rather go back to the UK to retire. I was unemployed for a year before returning to the US - so this may allow me to catch up on contributions (the least expensive class I believe) but I really don't know whether it is worth it.

Is there anyone else in this situation where they don't have many NI contributions and wanting to return later? Also, the reciprocal agreement may not continue (as with Australia) in the coming years, so cannot really rely on this, I am thinking
LindseyAnn is offline  
Old Dec 14th 2014, 8:24 pm
  #2  
Lost in BE Cyberspace
 
Hotscot's Avatar
 
Joined: Jun 2011
Location: Los Angeles
Posts: 6,156
Hotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond repute
Default Re: Anyone retiring to the UK on Social security only

It's worth it if you can make Class 2 contributions. They're relatively cheap and will give good bang for the buck...(Pound)
Hotscot is offline  
Old Dec 14th 2014, 10:14 pm
  #3  
Grumpy Know-it-all
 
Steve_'s Avatar
 
Joined: Jul 2010
Location: Calgary, Alberta
Posts: 8,928
Steve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond repute
Default Re: Anyone retiring to the UK on Social security only

Just do the Class 2 NI contributions, I think the annual cost is £145 and moreover they've just changed the billing method so they send you an invoice every year. Which hopefully means you won't need a UK bank account anymore, you can use a credit card.

Fill in the application at the back of this publication: https://www.gov.uk/government/upload...53/ni38_1_.pdf

Note from July 2015 they aren't going to do direct debits anymore.

Once you hit 30 years, HMRC sends you a letter to say you are paid up, then you stop paying. (The new legislation makes this 35 years, but people paying prior to April 2016 are grandfathered in).

This entitles you to the basic state pension. It's unlikely the reciprocal agreement with the US will be altered, imo. It's not the same situation as with Australia.
Steve_ is offline  
Old Dec 14th 2014, 10:26 pm
  #4  
BE Forum Addict
 
Joined: Apr 2011
Location: Ohio
Posts: 1,805
kodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond repute
Default Re: Anyone retiring to the UK on Social security only

Originally Posted by Steve_ View Post
Once you hit 30 years, HMRC sends you a letter to say you are paid up, then you stop paying. (The new legislation makes this 35 years, but people paying prior to April 2016 are grandfathered in).
I think it's the people actually retiring before April 2016 who only need 30 years. Everyone after that will have their pension recalculated under both the old/ new systems based on their contributions pre-April 2013, taking into account the basic pension and the State Second Pensions they've built up, be credited with the bigger of those results, then going forward will accrue qualifying years under the new system.

But still, yeah - Class 2 subs are a virtual no-brainer.
kodokan is offline  
Old Dec 14th 2014, 10:40 pm
  #5  
Grumpy Know-it-all
 
Steve_'s Avatar
 
Joined: Jul 2010
Location: Calgary, Alberta
Posts: 8,928
Steve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond reputeSteve_ has a reputation beyond repute
Default Re: Anyone retiring to the UK on Social security only

Nope, it's people who start paying NI after April 2016. State pension to increase by at least 2.5% a year - FTAdviser.com

For people who start their national insurance record after the reforms are introduced, the full level of the new state pension will be based on 35 years of national insurance contributions.
Steve_ is offline  
Old Dec 14th 2014, 10:45 pm
  #6  
Lost in BE Cyberspace
 
Hotscot's Avatar
 
Joined: Jun 2011
Location: Los Angeles
Posts: 6,156
Hotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond repute
Default Re: Anyone retiring to the UK on Social security only

Originally Posted by Steve_ View Post
Just do the Class 2 NI contributions, I think the annual cost is £145 and moreover they've just changed the billing method so they send you an invoice every year. Which hopefully means you won't need a UK bank account anymore, you can use a credit card.
Any more info on this?
Hotscot is offline  
Old Dec 14th 2014, 11:21 pm
  #7  
BE Forum Addict
 
Joined: Apr 2011
Location: Ohio
Posts: 1,805
kodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond reputekodokan has a reputation beyond repute
Default Re: Anyone retiring to the UK on Social security only

Originally Posted by Steve_ View Post
Nope, it's people who start paying NI after April 2016. State pension to increase by at least 2.5% a year - FTAdviser.com
Interesting - I'd misunderstood this, but it seems we're sort of both right. Come April 2016, the government will work out a starting amount under the new scheme, based on people's contributions to date. Going forward, they'll then have 4.24 quid added to that amount per qualifying year, until you hit the full pension amount of 148.40.

So for some people, yes, this may be less than 35 years all told - depends how much they've paid so far in SERPs-a-like, I suppose, which would increase the overall amount paid to date.

https://www.gov.uk/government/upload...-changes-4.pdf
kodokan is offline  
Old Dec 15th 2014, 12:28 am
  #8  
nun
BE Forum Addict
 
nun's Avatar
 
Joined: Aug 2004
Posts: 4,722
nun has a reputation beyond reputenun has a reputation beyond reputenun has a reputation beyond reputenun has a reputation beyond reputenun has a reputation beyond reputenun has a reputation beyond reputenun has a reputation beyond reputenun has a reputation beyond reputenun has a reputation beyond reputenun has a reputation beyond reputenun has a reputation beyond repute
Default Re: Anyone retiring to the UK on Social security only

You will be able to claim the new state pension if you are a man born on or after 6 April 1951 or a woman born on or after 6 April 1953.

As US SS is earnings related the OP should work as much as possible in the US and also look at making Class 2 voluntary NI. Those NI payments will not reduce her SS because of WEP and she has 24 years before her UK retirement age of 67. So she could get 29/35ths of the full UK pension (under the new rules) to go with her US SS.
nun is offline  
Old Dec 15th 2014, 2:58 am
  #9  
Lt Col (Retd)
 
Pulaski's Avatar
 
Joined: Dec 2001
Location: Dixie, ex UK
Posts: 47,670
Pulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond repute
Default Re: Anyone retiring to the UK on Social security only

Originally Posted by nun View Post
You will be able to claim the new state pension if you are a man born on or after 6 April 1951 or a woman born on or after 6 April 1953.

As US SS is earnings related the OP should work as much as possible in the US and also look at making Class 2 voluntary NI. Those NI payments will not reduce her SS because of WEP and she has 24 years before her UK retirement age of 67. So she could get 29/35ths of the full UK pension (under the new rules) to go with her US SS.
Depending on when she returned to the US, and presumably stopped paying NICs in the UK, she may be eligible to pay upto six years NICs in arrears too, so there is the possibility that she could get a complete 35/35ths, or at least rather more than the 29/35ths you mentioned.
Pulaski is offline  
Old Dec 15th 2014, 2:43 pm
  #10  
L2, GC, Surrey, OH, TX!
 
MsElui's Avatar
 
Joined: Aug 2007
Location: Surrey to Dallas (via Ohio)!
Posts: 6,357
MsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond repute
Default Re: Anyone retiring to the UK on Social security only

whats the difference between class2 and class 3? The form looks like class 2 is for 'self employed' (from page 4 of the leaflet)
MsElui is offline  
Old Dec 15th 2014, 2:46 pm
  #11  
Lt Col (Retd)
 
Pulaski's Avatar
 
Joined: Dec 2001
Location: Dixie, ex UK
Posts: 47,670
Pulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond repute
Default Re: Anyone retiring to the UK on Social security only

Originally Posted by MsElui View Post
whats the difference between class2 and class 3? The form looks like class 2 is for 'self employed' (from page 4 of the leaflet)
There are all sorts of odd circumstances that can make people Class 2 eligible, such that most, but not all, emigrants are Class 2 eligible. Class 3 is a lot more expensive.
Pulaski is offline  
Old Dec 15th 2014, 2:48 pm
  #12  
L2, GC, Surrey, OH, TX!
 
MsElui's Avatar
 
Joined: Aug 2007
Location: Surrey to Dallas (via Ohio)!
Posts: 6,357
MsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond reputeMsElui has a reputation beyond repute
Default Re: Anyone retiring to the UK on Social security only

Originally Posted by Pulaski View Post
There are all sorts of odd circumstances that can make people Class 2 eligible, such that most, but not all, emigrants are Class 2 eligible. Class 3 is a lot more expensive.
THANK YOU - ripping open envelope and changing form to '2'

ive got 22 years paid up NICs - so hopefully if i get on this now it wont be too 'painful' to catch up.
MsElui is offline  
Old Dec 15th 2014, 2:51 pm
  #13  
Lt Col (Retd)
 
Pulaski's Avatar
 
Joined: Dec 2001
Location: Dixie, ex UK
Posts: 47,670
Pulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond reputePulaski has a reputation beyond repute
Default Re: Anyone retiring to the UK on Social security only

Originally Posted by MsElui View Post
THANK YOU - ripping open envelope and changing form to '2'

ive got 22 years paid up NICs - so hopefully if i get on this now it wont be too 'painful' to catch up.
About the same as me then. ...... I am waiting to hear back having sent the form to "apply" to make arrears and on-going Class 2 contributions.
Pulaski is offline  
Old Dec 15th 2014, 3:10 pm
  #14  
Lost in BE Cyberspace
 
Hotscot's Avatar
 
Joined: Jun 2011
Location: Los Angeles
Posts: 6,156
Hotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond reputeHotscot has a reputation beyond repute
Default Re: Anyone retiring to the UK on Social security only

Originally Posted by MsElui View Post
THANK YOU - ripping open envelope and changing form to '2'

ive got 22 years paid up NICs - so hopefully if i get on this now it wont be too 'painful' to catch up.
The cost is [email protected] 140 GBP for each catch-up year and you don't need to pay all at once.

Last edited by Hotscot; Dec 15th 2014 at 3:20 pm.
Hotscot is offline  
Old Dec 15th 2014, 4:41 pm
  #15  
Account Closed
 
Joined: Nov 2012
Posts: 1,570
Uncle_Bob has a reputation beyond reputeUncle_Bob has a reputation beyond reputeUncle_Bob has a reputation beyond reputeUncle_Bob has a reputation beyond reputeUncle_Bob has a reputation beyond reputeUncle_Bob has a reputation beyond reputeUncle_Bob has a reputation beyond reputeUncle_Bob has a reputation beyond reputeUncle_Bob has a reputation beyond reputeUncle_Bob has a reputation beyond reputeUncle_Bob has a reputation beyond repute
Default Re: Anyone retiring to the UK on Social security only

Originally Posted by Hotscot View Post
The cost is [email protected] 140 GBP for each catch-up year and you don't need to pay all at once.
The wife and i applied and got reply, they want around 700 pounds for each year going back 6 or 7 years i think. For each of us. It would cost us approx $7k each to catch up
I'm not sure if its worth it, i could put $14k in an investment vehicle here.
The class NICS are a no brainer if you have recently been employed and making NIs in the UK. I think i missed the boat on this one. But then again i could have been paying only to retire and find out the government has changed the rules.

Or did i maybe apply to pay the wrong class of NICs?

Last edited by Uncle_Bob; Dec 15th 2014 at 4:48 pm.
Uncle_Bob is offline  

Contact Us - Archive - Advertising - Cookie Policy - Privacy Statement - Terms of Service - Do Not Sell My Personal Information

Copyright © 2018 MH Sub I, LLC dba Internet Brands. All rights reserved. Use of this site indicates your consent to the Terms of Use.