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Got Greencard - how to stop paying National Insurance?

Got Greencard - how to stop paying National Insurance?

Old Sep 3rd 2012, 7:43 pm
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Post Got Greencard - how to stop paying National Insurance?

Hi Guys

I have been in the USA for just over 3 years and have been paying National Insurance contributions the whole time My company in HQ'd in the UK but I get paid in USD and have no ties to the UK.

I just got my Green Card and plan on staying here indefinitely. I want to stop paying National Insurance contributions to the UK as I plan on retiring in the US.

I have read a few comments about doing this but nothing specific (I'm still lost lol). Someone also mentioned I can get a refund from the date I arrived here. That would be pretty awesome! Can anyone confirm?

What do I specifically need to do to stop paying national insurance? Certain forms etc? Do i need (or do you recommend) a lawyer, accountant etc? Any recommendations if so? My Tax Accountant has no experience with the UK/Expats

Thanks, hopefully this is pretty straight forward stuff!

Toby
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Old Sep 3rd 2012, 8:11 pm
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Default Re: Got Greencard - how to stop paying National Insurance?

Originally Posted by Alrescha View Post
Hi Guys

I have been in the USA for just over 3 years and have been paying National Insurance contributions the whole time My company in HQ'd in the UK but I get paid in USD and have no ties to the UK.

I just got my Green Card and plan on staying here indefinitely. I want to stop paying National Insurance contributions to the UK as I plan on retiring in the US.

I have read a few comments about doing this but nothing specific (I'm still lost lol). Someone also mentioned I can get a refund from the date I arrived here. That would be pretty awesome! Can anyone confirm?

What do I specifically need to do to stop paying national insurance? Certain forms etc? Do i need (or do you recommend) a lawyer, accountant etc? Any recommendations if so? My Tax Accountant has no experience with the UK/Expats

Thanks, hopefully this is pretty straight forward stuff!

Toby

When we moved to the US - and my company is HQ'd in the UK and we were transferred to the US branch - we immediately started paying SS and Medicare subscriptions here and nothing at all related to UK National Insurance Contributions.

Have you been paying SS and Medicare deductions? If not, then you have something special defined as per your expat contract. Maybe your company assumed you would be returning and therefore maintained your contributions in the UK as opposed to the US.

We informed HM Revenue that we were non residents in the UK, soon after moving to the US.

We then, after some years, made back payments to bring our UK National Insurance Contributions up to date so we could claim a higher Old Age pension. (We moved to the US at a fairly late age). Don't know about getting any refunds since NI contributions go towards your State pension - something you can always claim no matter how long you have been out of the UK.

You need to inform HM Revenue that you are no longer resident in the UK, and your HR/Company that you should be paying US deductions.
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Old Sep 3rd 2012, 8:41 pm
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Default Re: Got Greencard - how to stop paying National Insurance?

Originally Posted by SanDiegogirl View Post
When we moved to the US - and my company is HQ'd in the UK and we were transferred to the US branch - we immediately started paying SS and Medicare subscriptions here and nothing at all related to UK National Insurance Contributions.

Have you been paying SS and Medicare deductions? If not, then you have something special defined as per your expat contract. Maybe your company assumed you would be returning and therefore maintained your contributions in the UK as opposed to the US.

We informed HM Revenue that we were non residents in the UK, soon after moving to the US.

We then, after some years, made back payments to bring our UK National Insurance Contributions up to date so we could claim a higher Old Age pension. (We moved to the US at a fairly late age). Don't know about getting any refunds since NI contributions go towards your State pension - something you can always claim no matter how long you have been out of the UK.

You need to inform HM Revenue that you are no longer resident in the UK, and your HR/Company that you should be paying US deductions.
Thanks, Sandiagogiel

I have not paid any Social Security or Medicare here. My HR manager did assume I would be coming back but now that's not the case I will file to stop paying.

Still hopeful about the refund, 3 years of payments would be pretty sweet!
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Old Sep 3rd 2012, 10:37 pm
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Default Re: Got Greencard - how to stop paying National Insurance?

Why would you want to stop paying NI contributions. It sounds as if you will qualify to pay Class 2 voluntary NI contributions which only cost 120 GBP a year and they will qualify you for a full UK state pension after 30 years. If you have fewer than 30 years of US SS contributions the UK pension will reduce your US SS, but you'll probably still come out ahead....of course that would depend on the relative sizes of US SS and UK state pension.
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Old Sep 3rd 2012, 10:45 pm
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Default Re: Got Greencard - how to stop paying National Insurance?

Originally Posted by Alrescha View Post
Thanks, Sandiagogiel

I have not paid any Social Security or Medicare here. My HR manager did assume I would be coming back but now that's not the case I will file to stop paying.

Still hopeful about the refund, 3 years of payments would be pretty sweet!
...... not as sweet as if you left them in the fund and took your OAP. The returns you get on your OAP payments is much better than anything you could do on your own.
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Old Sep 3rd 2012, 10:47 pm
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Default Re: Got Greencard - how to stop paying National Insurance?

Originally Posted by nun View Post
Why would you want to stop paying NI contributions. It sounds as if you will qualify to pay Class 2 voluntary NI contributions which only cost 120 GBP a year and they will qualify you for a full UK state pension after 30 years. If you have fewer than 30 years of US SS contributions the UK pension will reduce your US SS, but you'll probably still come out ahead....of course that would depend on the relative sizes of US SS and UK state pension.
Hi Nun. $120 a year sounds like a deal. I currently pay 12% of my income to NI contributions and I dont plan on returning to the UK. I may change my mind but I fully plan on managing my own retirement anyway. 12% is a lot and I'm kinda P***ed my employer told me "I had to keep paying" - sounds like a refund may be tough to get (According to another forum). I feel like I just paid out 12% for nothing.
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Old Sep 3rd 2012, 11:38 pm
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Default Re: Got Greencard - how to stop paying National Insurance?

Originally Posted by Alrescha View Post
Hi Nun. $120 a year sounds like a deal. I currently pay 12% of my income to NI contributions and I dont plan on returning to the UK. I may change my mind but I fully plan on managing my own retirement anyway. 12% is a lot and I'm kinda P***ed my employer told me "I had to keep paying" - sounds like a refund may be tough to get (According to another forum). I feel like I just paid out 12% for nothing.

No you have not paid out 12% for nothing. You sound like you are reasonably young, so probably not thinking about your retirement too much at this stage.

Your payments will roll up throughout the years and will pay out when you retire.

Why did you wait 3 years before sorting this out?

You would still have had to pay Social Security and Medicare payments here in the US anyway, even if you ARE going to look after your own retirement.
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Old Sep 4th 2012, 12:59 am
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Default Re: Got Greencard - how to stop paying National Insurance?

Originally Posted by Alrescha View Post
Hi Nun. $120 a year sounds like a deal. I currently pay 12% of my income to NI contributions and I dont plan on returning to the UK. I may change my mind but I fully plan on managing my own retirement anyway. 12% is a lot and I'm kinda P***ed my employer told me "I had to keep paying" - sounds like a refund may be tough to get (According to another forum). I feel like I just paid out 12% for nothing.
Google "Class 2 voluntary national insurance". It's easy to apply. I've been paying them for 25 years and with 5 years of previous contributions I'm now at the 30 years limit and will stop paying NI, unless i ever work in the UK again. I'll get full UK state pension when I retire at 62. I estimate my UK pension will be $320/week (using 3% inflation) and it will reduce my US SS by $140/week because I only have 17 years of SS payments. Still I'm way ahead given the Class 2 NI is only 2.65 GBP/week
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Old Sep 4th 2012, 1:38 am
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Default Re: Got Greencard - how to stop paying National Insurance?

Originally Posted by nun View Post
Google "Class 2 voluntary national insurance". It's easy to apply. I've been paying them for 25 years and with 5 years of previous contributions I'm now at the 30 years limit and will stop paying NI, unless i ever work in the UK again. I'll get full UK state pension when I retire at 62. I estimate my UK pension will be $320/week (using 3% inflation) and it will reduce my US SS by $140/week because I only have 17 years of SS payments. Still I'm way ahead given the Class 2 NI is only 2.65 GBP/week
Aren't Class 2 NIC usually for self-employed ?
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Old Sep 4th 2012, 3:15 am
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Default Re: Got Greencard - how to stop paying National Insurance?

Originally Posted by SanDiegogirl View Post
Aren't Class 2 NIC usually for self-employed ?
Yes, but if you work overseas you can qualify to pay them.
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