The extended period in which voluntary contributions can be made towards your State Pension is coming to an end (5 April 2025). If you have not yet checked if this extension will benefit you, we are recommending that you do so as soon as possible to check for any gaps in your National Insurance record between 2006 -2018 which may be filled by making voluntary contributions.
Why
To provide a little more context, the end goal of this exercise is to ensure that by the time any individual reaches State Pension age that they are entitled to the full amount available to them based on their circumstances. As the State Pension system is complex the maximum amount can differ depending on age, qualifying years and which periods those qualifying years fall into. However, the most accurate and easily accessible guide is available on the Personal Tax Account via the State Pension forecast. This document will set out how many qualifying years you have to date and how many further qualifying years you will have at State Pension age assuming you will continue to contribute. It will also set out how many gaps are available for you to make voluntary contributions and how this will impact the payments that you will receive. The cost of doing this will vary according to your circumstances but it will be clearly set out in the forecast.
For some this may not require any further action but for others it could make a large cash difference once they reach State Retirement age so even if you believe you have the full entitlement, there would be no harm in checking, especially as the personal tax account in itself is a very helpful tool to have access to.
What you need to do
For those that have already set up the Personal Tax Account, just log in as usual and select ‘ Your National Insurance and State Pension’ , from there you can view your State Pension summary with guidance on improving it.
For those who have not yet set this up then you will need to follow the link below (the process takes around 10 minutes but you will need to have certain information available to proceed which is included in the link
Personal tax account: sign in or set up – GOV.UK.
How we can help
Whilst we are unable to create or view an individual’s personal tax account, once you have received your pension forecast, we would be more than happy to discuss the results with you and help in any other way that we can and our tax team will be ready to assist. Please note that we can only offer general advice is respect of the State Pension and are unable to make any recommendation in respect of personal pensions or other areas generally dealt with by Financial Advisors.
When
The deadline for making voluntary contributions for the years ended 5 April 2006 to 5 April 2018 is 5 April 2025. However, HMRC have granted some grace for those who have started the process but not actually made payment of the contributions before that date provided they have at least made the claim and requested a callback to be able to make the payments Request a call back to pay voluntary National Insurance contributions – GOV.UK.
Should you require any further information in relation to this please do not hesitate to get in touch with a member of our tax team below: https://www.langtons.uk.com/our-approach/key-team-members/
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