The Department for Work and Pensions (DWP) has relaxed rules regarding the topping of the State Pension, meaning people could potentially boost their retirement income.
The DWP has temporarily halted the six-year deadline for topping up missing qualifying years of National Insurance contributions.
This means that people have the opportunity to increase the amount of money they will get through the State Pension when they claim it.
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The UK Government's Future Pension Centre has stated that anybody who reached the State Pension age any time after April 2016 will be allowed to purchase National Insurance credits for missing years going back to 2006.
This means that any man born after April 5 1951, or any woman born after April 5 1953, is able to boost their State Pension by making voluntary NI contributions.
As reported by The Mirror, the relaxed rules will be in effect until April 5, 2023, after which the six year deadline will come back into effect.
Senior pensions and retirement analyst at Hargreaves Lansdown Helen Morrissey said: “Making voluntary national insurance contributions is great opportunity for people to make up gaps in their state pension record and boost the amount they get in retirement.
"Many people will have these gaps if they were unemployed or didn’t earn enough to get a national insurance credit and being able to top up their pension in this way is very cost-effective and a good option for many people.
"Only being able to go back six years can be a frustration so the ability to top up back to 2006 is hugely useful for those who can benefit from it."
Making voluntary NI contributions allows people to fill in gaps in their National Insurance record and therefore get a bigger payout.
In order to qualify for the full State Pension, you must have 35 qualifying years on your National Insurance record, and if there are gaps you will receive a lower payout.
Filling in these gaps through voluntary NI contributions allows you to bring your pension up to the full £185.10 amount.
Doing this is only beneficial for people who have gaps in their NI contributions, as those who do not will already receive the full State Pension.
You are able to pay voluntary contributions regardless of whether you live abroad, and whether you are in work or not.
The only thing that is required is that you have previously lived in the UK for at least three consecutive years or paid at least three years of NI contributions.
At the moment, it costs £824.20 to buy one year of national insurance credits (assuming you pay Class 3 NI), which would add £275 a year to your State Pension.
If you expect to be claiming the State Pension for the next three or more years and have a shortfall in your payments, it’s worth making the voluntary contribution.
But be aware of the risks as sometimes increasing your state pension might mean you get reduced pension credit, or pay higher tax, if your income tips into the next tax band.
If you are self-employed, you’ll pay £3.15 a week national insurance tax on your contribution - or £15.85 on the higher band.
Before making voluntary NI contributions, you need to check your NI record to see if you have any gaps in your record, and get a pension forecast.
Speak to the Future Pension Centre, as they’ll be able to assess whether it’s worth you making a top-up.
You can contact the government’s Future Pension Centre here.
