National Insurance Record for State Pensio

During your working life you earn credits towards state benefits e.g. a State Pension.

There are many ways to earn these credits, and the rules have changed over the years so the best way to see what you are entitled to, is to check your record. See https://www.gov.uk/check-state-pension.

Issues you may wish to address: –

• Have you already achieved the maximum or do you need to act?
• Are there errors or omissions you may need to chase up?
• Are there gaps in your record – what were you doing?
• Are you entitled to claim extra credits – to fill gaps to increase your pension.
• Are you currently receiving all the credits to which you are entitled?
• What is your current forecast?
• Will you get to the maximum before you reach state pension age?
• Can you earn/pay extra contributions to get to the maximum?
• Could you pay voluntary contributions to increase your pension or is it not worthwhile? And if so for which years?

What you need to get a full state pension

• 35 years of credits
• If you have credits for 75% of the tax year then that should count as a full year’s credit, but less and it may count for nothing.

How you may earn credits automatically

• Employees earn one credit every pay period (per month or per week) if they earn enough that pay period.
• Directors earn a credit for the whole year if they earn enough that tax year from that employer, but nothing if less.
• Self-employed earn a credit for the year if they earn over a certain limit, and below that they can elect to pay for a self-employed credit.
• Those unemployed and claiming job seekers get credits each week of claim.
• Registered to receive child benefit for a child under 12, then you get credits – but take care: –
  • this is only the first named person registered; however such credits may be transferred to spouse or partner.
  • if expecting to repay child benefit (because the higher earning partner earns over £60,000) then you may have decided not to register for child benefit, but you would then not get credits either. To get credits you need to register for Child Benefit, and you may then disclaim so as not to receive the child benefit that would then need to be repaid.
• On a government sponsored training course of less than 1 year is over age 18
• Claiming Carers allowance

When you can apply for extra free credits

• Spouse or partner accompanying a member of the armed forces on an overseas posting.
• Unemployed actively seeking work.
• On statutory sick pay, maternity allowance, or Incapacity benefit
• Full-time approved training course of less than 1 year over age 18
• Registered foster carer
• A carer for more than 20 hours per week
• HMRC can top up the years between ages 60 & 65 for men born before 6/10/53.

When you can pay for extra free credits

Finally you can pay for extra credits – you need at least ¾ of a years’ worth of credits to count as a year.  If short or missing a year, then you can pay to top up to 100% to get your years credit.

• Self-employed can voluntarily pay for credits if they do not earn enough– includes self-employed who have gone aboard or to prison.
• Anyone can pay voluntary contributions to top up to a full year.

Warning: – you can usually only top up the last 6 years

Note: buying credits is not the only way to increase your state pension, or retirement income so do check with your financial advisor if this is the right step for you.

HMRC system errors

Pensions being paid now may depend on information added to HMRC systems over many decades and there are some known errors in HMRC records that could apply to you.

Before 2013 payroll information was not submitted by employers to HMRC electronically; paper records such as small employer P60’s were not necessarily checked and could have missing information e.g. no national insurance numbers, or typo’s when handwriting could not be deciphered.

Before 2000, National Insurance numbers were not required to claim child benefit, so such payments may not have triggered credits on your record.

Before 2024 HMRC neglected to send out notices advising of gaps in peoples records.

Before 2024 it was necessary for the self-employed to register for both income tax and national insurance, otherwise they would not necessarily be asked to pay the class 2 National Insurance contributions required to earn credits.  HMRC have only just advised they will be contacting those taxpayers who neglected to register and pay such national insurance – so they may pay the missing contributions and hence earn the credits for the period 1981 to 2014.  An App to apply and pay is planned to be available from 2027.

Check your state pension now and have a happy retirement.