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Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Old Jun 10th 2011, 12:44 pm
  #181  
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Default Re: Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Originally Posted by bandrui View Post
Well I received the letter from pensions last week and it was "What happens if you defer receiving your pension" but that wasn't the question I asked. I wanted to know if I could buy enough back years to qualify for a UK pension.
I got my pension forecast a couple of weeks ago and I was surprised to see that I have 3 more years of contributions than I thought. I'm eligible for 27/30ths of the pension and I got credit for ages 16, 17 and 18 even though I was at school.

The week after I got my bill for Class 2 contributions which was 124.80 pounds for the 2010 tax year. I just sent off the check so only 2 more years and I can stop paying.
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Old Jun 10th 2011, 3:53 pm
  #182  
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Default Re: Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Originally Posted by nun View Post
I got my pension forecast a couple of weeks ago and I was surprised to see that I have 3 more years of contributions than I thought. I'm eligible for 27/30ths of the pension and I got credit for ages 16, 17 and 18 even though I was at school.

The week after I got my bill for Class 2 contributions which was 124.80 pounds for the 2010 tax year. I just sent off the check so only 2 more years and I can stop paying.
I'm confused ,as I paid class3 NI contributions at a much higher rate than that (and have been employed in Canada at the same time ). Should I have paid class 2 rates instead??
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Old Jun 10th 2011, 6:12 pm
  #183  
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Default Re: Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Originally Posted by nun View Post
I got my pension forecast a couple of weeks ago and I was surprised to see that I have 3 more years of contributions than I thought. I'm eligible for 27/30ths of the pension and I got credit for ages 16, 17 and 18 even though I was at school.

The week after I got my bill for Class 2 contributions which was 124.80 pounds for the 2010 tax year. I just sent off the check so only 2 more years and I can stop paying.
Ref your three years of credits:

http://www.direct.gov.uk/en/MoneyTax...ance/DG_190059

Who is eligible for National Insurance credits?

"There are different circumstances in which you may be able to get credits. These include: for the years in which you have your 16th, 17th and 18th birthdays ('starting credits') - new awards of starting credits will no longer be made for anyone who is 16 on or after 6 April 2010"
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Old Jun 10th 2011, 6:16 pm
  #184  
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Default Re: Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Originally Posted by ramblingsue View Post
I'm confused ,as I paid class3 NI contributions at a much higher rate than that (and have been employed in Canada at the same time ). Should I have paid class 2 rates instead??
I have received a Pension Forecast for my spouse who is working overseas. Along with the forecast and schedule to pay future Class 3 contributions it advises that one can make application to HMRC for an alternative payment of Class 2 contributions when one has produced details of actual overseas employment.
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Old Jun 11th 2011, 1:06 am
  #185  
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Default Re: Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Originally Posted by ramblingsue View Post
I'm confused ,as I paid class3 NI contributions at a much higher rate than that (and have been employed in Canada at the same time ). Should I have paid class 2 rates instead??
Back in the 90s HMRC changed the rules and allowed people employed abroad by a foreign organization to pay Class 2 rather than Class 3. There are also requirement as to how long you lived in UK before you became an expat. Just google "Class 2 NI contributions" and you'll find the rules. If you qualify aply to pay Class 2 rather than Class 3 as they are cheaper and give you more benefits too.....weird but true.
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Old Jun 13th 2011, 6:01 pm
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Default Re: Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Originally Posted by nun View Post
Back in the 90s HMRC changed the rules and allowed people employed abroad by a foreign organization to pay Class 2 rather than Class 3. There are also requirement as to how long you lived in UK before you became an expat. Just google "Class 2 NI contributions" and you'll find the rules. If you qualify aply to pay Class 2 rather than Class 3 as they are cheaper and give you more benefits too.....weird but true.
Thanks for the info Nun. I called UK this morning and was told to apply for Class 2 (actually it's for my OH who has been paying class 3. I have paid my 30years up ).

Yes, Class 2 does give you more benefits As the lady explained to me, "even with Class 3 contributions , we still pay less than working people in the UK do each month for their NI contributions " .
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Old Jun 13th 2011, 8:26 pm
  #187  
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Default Re: Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Originally Posted by bandrui View Post
Tina, I spoke to the Uk International pensions group in Newcastle yesterday. The correct phone number is 011 44 191 218 7777. I had called the other number ending in 2010 which is in Swansea and they transferred me as I had the wrong number. They are open from 8am to 8pm local time to allow for calls from overseas.
(It was very heart warming to hear a lilting Welsh accent followed by a lovely Geordie accent.)
I had worked about 3 years in the UK and was told that I would likely get nothing from UK pensions. They said that the minimum requirement is 10 years and even if I purchased 6 years (the max) of NI contributions, I would not have enough and since I would be getting a pension from another country would not qualify under the totalisation agreement. However they did say they would fill out my request and forward it to another department who would investigate and send me a letter.
Now I am already pension age so it may be different for you if you have time to accumulate more years.
Good luck!


I started work in 1994 and left for the USA in 2001. I was continuously employed all that time so I have about 7 years of NIC.

I have paid no voluntary contributions since then but I would like to now, but your post worries me, is it to late for me to make voluntary NICS?
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Old Jun 13th 2011, 9:57 pm
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Lightbulb Re: Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Originally Posted by drhewitt View Post
I started work in 1994 and left for the USA in 2001. I was continuously employed all that time so I have about 7 years of NIC.

I have paid no voluntary contributions since then but I would like to now, but your post worries me, is it to late for me to make voluntary NICS?
Have you been working in the US? When I was at a US Social Security office in Montclair, New Jersey, a year or so ago (to get a replacement of a lost Soc. Security card) there was a leaflet about a reciprocal agreements for social security between the UK and the US. I'm afraid I don't know the leaflet number, but I do recall that anyone working in the US and paying 'Social Security' can apply for their credits to go towards their UK Nat Ins credits (but you can't do it simultaneously for both countries ie. 'double-dip').

The leaflet was on display in the reception area - I guess you could just walk into any SS office (or get someone to go for you) and look for the leaflet...or see if it's online on the SS.gov website.
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Old Jun 13th 2011, 11:09 pm
  #189  
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Default Re: Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Originally Posted by Englishmum View Post
Have you been working in the US? When I was at a US Social Security office in Montclair, New Jersey, a year or so ago (to get a replacement of a lost Soc. Security card) there was a leaflet about a reciprocal agreements for social security between the UK and the US. I'm afraid I don't know the leaflet number, but I do recall that anyone working in the US and paying 'Social Security' can apply for their credits to go towards their UK Nat Ins credits (but you can't do it simultaneously for both countries ie. 'double-dip').

The leaflet was on display in the reception area - I guess you could just walk into any SS office (or get someone to go for you) and look for the leaflet...or see if it's online on the SS.gov website.
Interesting !

I found a link explaining the program(m)e here

http://www.ssa.gov/international/Agr...phlets/uk.html
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Old Jun 14th 2011, 5:49 pm
  #190  
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Default Re: Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Originally Posted by Englishmum View Post
Have you been working in the US? When I was at a US Social Security office in Montclair, New Jersey, a year or so ago (to get a replacement of a lost Soc. Security card) there was a leaflet about a reciprocal agreements for social security between the UK and the US. I'm afraid I don't know the leaflet number, but I do recall that anyone working in the US and paying 'Social Security' can apply for their credits to go towards their UK Nat Ins credits (but you can't do it simultaneously for both countries ie. 'double-dip').

The leaflet was on display in the reception area - I guess you could just walk into any SS office (or get someone to go for you) and look for the leaflet...or see if it's online on the SS.gov website.
If you work in the US you'll be paying FICA taxes towards you SS. As a UK citizen with some previous UK residency requirements you can also pay voluntary UK NI payments. If you have a 30 years of payments into both systems you will get full benefits form both!

If you have less than 30 years of US SS and you get a UK basic state pension you will have your US SS reduced...but if you can pay UK NI Class 2 contributions you'll still come out way ahead.

If you have Social Security credits in both the United States and the United Kingdom, and you meet all the basic requirements under one country's system, you will get a regular benefit from that country. If you don't meet the basic requirements, then you can combine your credits from both countries to get you to that threshold, a partial benefit can then be paid, which is based on the proportion of the worker's total career completed in the paying country.

Last edited by nun; Jun 14th 2011 at 5:58 pm.
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Old Jun 28th 2011, 12:05 pm
  #191  
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Default Re: Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Here's even more reason to pay voluntary NI. The removal of the second state pension will increase the basic state pension so your Class 2 contributions will get you a bigger payment. The article mentions the possibility of increased payments, but if you qualify for Class 2 the increase would have to be enormous to stop it form being a great deal.

http://www.guardian.co.uk/money/2011...sions-pensions
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Old Jun 28th 2011, 4:02 pm
  #192  
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Default Re: Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Originally Posted by Mallory View Post
You can earn $14,160.00 at age 62, while drawing SS. Then above that they will take, I believe, a dollar away from every 2 dollars earned. It's less after your normal retirement age, and they take nothing away after age 70. It is not taken away permanently though. When you reach your normal full retirement age, an adjustment is made to allow for those earnings forfeited, and it is given back to you over time in a higher social security check. Also, since you are still paying SS in earnings, you will get an adjustment for that also.
Mallory hello again,
You are absolutely correct in everything you say here ----(EXCEPT) one thing,
(AFTER) 66 for most people now the full retirement age in U.S. (some people 65) depending on the year they were born ----- repeat after full retirement age there is NO reduction from there SS payments no matter how much they earn in there Job, ---- if they continue to work.
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Old Jun 28th 2011, 9:51 pm
  #193  
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Default Re: Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Originally Posted by Mummy in the foothills View Post
I'd check with US SS, I don't know if they care how long you were married, (didn't he pass away?) You can take reduced pension at 62 I think.
Do you get the annual statements?
To claim a possibly higher SS benefit based on your spouses lifetime earnings ---- first the rules are that you MUST have been married at least 10 years in US, and the spouse must be of retirement age, but you can be divorced and still claim on your ex - spouses lifetime earnings,
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Old Jul 22nd 2011, 11:33 pm
  #194  
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Default Re: Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Originally Posted by Englishmum View Post
Have you been working in the US? When I was at a US Social Security office in Montclair, New Jersey, a year or so ago (to get a replacement of a lost Soc. Security card) there was a leaflet about a reciprocal agreements for social security between the UK and the US. I'm afraid I don't know the leaflet number, but I do recall that anyone working in the US and paying 'Social Security' can apply for their credits to go towards their UK Nat Ins credits (but you can't do it simultaneously for both countries ie. 'double-dip').

The leaflet was on display in the reception area - I guess you could just walk into any SS office (or get someone to go for you) and look for the leaflet...or see if it's online on the SS.gov website.

Update...I just received my pension forecast and apparently I have nine years of NICs and have the opportunity to make voluntary payments for tax years 2005/06 and up. By the end of this year, I will have met the US requirement for 40 quarters of work to qualify for social security.

Ideally, I will either do my 30 years here and keep making voluntary NIC contributions for 30 years, or go to the UK sooner and just deal with the WEP deduction.
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Old Jul 23rd 2011, 12:23 am
  #195  
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Default Re: Retirement - US Soc Sec, UK Nat Ins, and the Totalization Agreement

Originally Posted by drhewitt View Post
Update...I just received my pension forecast and apparently I have nine years of NICs and have the opportunity to make voluntary payments for tax years 2005/06 and up. By the end of this year, I will have met the US requirement for 40 quarters of work to qualify for social security.

Ideally, I will either do my 30 years here and keep making voluntary NIC contributions for 30 years, or go to the UK sooner and just deal with the WEP deduction.
Excellent. Make sure you do the Class 2 NI contributions. If you don't make 30 years of SS payment you'll get WEPed, but the UK pension will make up for it unless you are ridiculously well paid.
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