Expatrian

Greetings all. I was wondering if anyone could comment on whether either making voluntary NI contributions or taking a UK state pension as an expat could in any way impact maintaining a non-UK domicile of choice (and thus avoiding any issues with UK inheritence taxes down the road)?

durham_lad

Without knowing all your circumstances I would not know the significance of taking OAP but making voluntary contributions certainly won’t affect the situation. Have you walked yourself through the Domicile test?

https://www.gov.uk/government/public...-test-srt-rdr3

Expatrian

Thanks for the reply. There is no question I am a non UK resident (I’ve lived in the US for over 30 years, only visiting the UK for vacations for less than 2 weeks every few years on average). I am also certain (as anyone can be) that I have clearly established a domicile of choice in the US, displacing my UK domicile of origin. I have spent the last few weeks researching the concepts of UK residency and domicile, and which I’ve learned are two distinctly different things, I think I’m going to start a new post on the subject to not hijack this one. I searched the forum for prior discussions ref. domicile, and there have been some related posts, but having learned what I have recently, I think it could be of interest (and concern) to any expats who think they are safe from UK inheritance tax because they’ve lived abroad for years. Cheers.

durham_lad

Good idea to start a new thread, it should be very interesting.

BennyBall

For those wondering how long a voluntary contribution for NICS takes to show on your online account….
I made a two year voluntary class three contribution on 27th April and it was finally posted on my account today 22nd August.
Therefore a little under four months without me phoning or requesting any updates.
31 years paid now ….. Almost done !!!!

PetrifiedExPat

Have not called yet, but, I moved from the UK after my PhD (stipend, not taxed and no NI taken). I dont have any other income accruing the three years. Assume im fubar'd re: class 2?

Pulaski

Or Class 3.

Sounds like it as I believe the minimum requirement for a persisting NI "account" is three years of actual (not deemed) contributions. .... Personally I'd still call to check/ confirm, straight from the horses mouth.

Earl Tucker

Hello all,
This thread is really helpful. My situation; I have been abroad for 20 years, and I have been making Class 2 contributions for all but 9 of those years. I need another 16 years of contributions for full pension; conveniently, I have 16 years to go before I reach pension age and I am heading back to UK next year.

Firstly, is it worth paying some of those missing years as class 2 while I can? Won't I still have to pay class 3 contributions when I get back anyway? (If it's relevant, I probably won't be working as such; just living off investment and rental income. I assume I still have to pay NI and that it will be Class 3.) If I pay missing years now, won't I just end up paying for more than 35 years worth of NI?

Secondly, if it IS worth paying the missing years, how do you actually pay it? We have been in touch several times with HMRC and they keep telling us to fill in the form to apply for Class 2 payments. We are already paying them; we are trying to pay previous years, but they don't seem to acknowledge this and tell us how to do it. (And last time we sent the form, it took six months to get the official answer!) Like, do we need explicit permission to pay certain years or can we just send an appropriate payment to the account we currently make our Class 2 payments to and assume it will get credited to previous years?

And help hugely appreciated - this has been going on for ages now and it's driving us crazy!

durham_lad

Our experience for my wife and I is that we applied for and received the letter stating exactly how many missing years we could pay and exactly how much that would cost. We then used that letter reference when paying. This was a few years ago for my wife after we were back in the UK, I applied by letter some years before that from the USA.

If you can pay Class 2 missing years it will be hundreds less per year than paying Class 3 so stick at it.

Glasgow Girl

NIs are only paid through earned income, or voluntary contributions. If you are not working when you return to the UK you won’t be making any NI contributions on rental income or investment income. Therefore you will need to make voluntary contributions to fill in the required 16 years. If you are sure you will not work again in the UK I would be inclined to fill in as many back years as I can because they could change the rules, or cost, of 2 voluntary NICs at any time. Class 2 NICs are an extremely generous benefit which they tried to eliminate a few years ago and with all the cost saving measures I would not be surprised to see them try that again, or limit who is eligible, perhaps by increasing the number of years required or cutting out those who live abroad. All speculation, but a bird in the hand and all that.

With regard to making the back payments, fill in form CF83 (even though you are already making payments) and check box 25, that should trigger them to get the ball moving on the back years. I would do it without delay. If any of your back years are pre 2016 that door closes in April 2023 and it likely will take them some time to process your application. I might also send them a separate letter asking them to identify which years you can backfill and how to do it, that should also trigger them to send you the official information. I think they do better in writing than with verbal communication because there is official documentation of all communication.

Earl Tucker

Thanks - helpful to know that there is an 'official' letter which we need to secure.

Earl Tucker

THanks you for this - really clear and helpful, especially with regard to NI payments. We'll fill in the form again and see what happens this time!

USADragon

How do you actually make the payments if you don't have access to a UK bank account? The direct debit information on the form doesn't seem to accommodate US bank info.

durham_lad

You can open a Wise account from the USA denominated in GBP with a UK bank sort code and account number. Easy to transfer USD to that account to pay NI contributions.

USADragon

Excellent! I hadn't heard of that. Thanks!