National Insurance contributions

[237SJ]

I read somewhere that the law has changed regarding national insurance and the state pension. Maybe I`m incorrect but was I right in thinking that after april 6th this year, you have to work for 30 years and contribute for 30 years to get a full state pension (used to bo 44 for men and 39 for women)

[Buenchico]

Correct!
http://www.direct.gov...tToRetire/DG_10021384

Chris

[factor-fiction]

Yes you are correct (provided of course the person has also reached state pension age).
This is a good site for information:
http://www.direct.gov...tatePension/DG_069498

[factor-fiction]

Sorry Chris- yours wasn't there when I started typing my response.

[237SJ]

Thanks,. It`s nice to get the links but i would prefer a straight simple answer from someone in the business so to speak. They used to say a man had to work for 44 years and a woman for 39 years. If you carry on paying your contributions, I understand you can`t claim them back in retrospect. My understanding is that one`s national insurance contributions contribute to the NHS etc so if you have reached the 30 years, do you get a discount for not contributing to the pension?

[Buenchico]

If you're employed, or self-employed, you're legally obliged to continue paying National Insurance contributions (at the relevant rate) up until you reach state pension age. If you've got more than one job you have to pay NI contributions for each job (assuming, of course, than you earn enough from any particular job to need to pay NI). Thereafter you can apply for a certificate of exemption from HMRC. (If you don't get that certificate your employer will still be obliged to deduct NI contributions from your pay, even though he knows that you've reached state pension age).

So you still have to continue paying contributions after you've fulfilled the '30 year' quota. Strangely however, there appears to be no specific penalty for failing to do so. If you're self-employed, and fail to pay any NI contributions, you'll receive a letter telling you how much you need to pay in order to 'catch up'. However that letter specifically states that it is not a demand for payment and that you're not actually obliged to pay that amount. (I write from experience - several times over!).

Chris

[factor-fiction]

Yes, the minimum is 30 years but for the system to be affordable it needs most people to pay more than 30 years. If we could stop paying after 30 years the pension would not be affordable I'm sure

[237SJ]

But Buenchico, I saw something on MoneyMail from someone who had been paying his contributions for 48 years and had just realised the law had changed. He was asking about claiming back overpayments and the experts said he couldn`t. Maybe it`s one for my accountant

[factor-fiction]

Hi 237SJ- I don't see any contradiction between what Buenchico has said and what the MoneyMail article said

[237SJ]

Fair enough. But I think sometimes one needs to sit down and listen to the facts verbally from the experts. Just one of those boring things you have to do when you get older!