The Department of Work and Pensions has been overwhelmed with demand as workers scramble to plug gaps in their pensions before the original deadline of April 5.
Experts have been urging the public to pay voluntary National Insurance (NI) contributions in the months running up to the deadline in order to receive a better state pension when they retire, but with the deadline just weeks away, many could not get through on the phone lines. The DWP has now moved to reassure the public, saying "If customers are unable to pay voluntary contributions by April 5 2023 for reasons beyond their control, it will consider payments made after the cut-off."
To receive the full new state pension of £203.85 per week from April, you need to have at least 35 years of contributions on your record, and according to Martin Lewis, paying voluntary contributions reasons could turn out to be "incredibly lucrative" for 45-70 year olds. "Many can spend £800 or less (on contributions) and get £5,500 back," he said.
Read more: DWP: The conditions which are most and least likely to be awarded PIP payments
Buying back missed years can be a good way to boost retirement income as the full new state pension will be worth up to £10,600.20 over the 2023/24 financial year - paid every four weeks at £203.85.
People can make up any NI gaps in their record going back as far as 2006, but after April 5, you will only be able to go back six years. However, according to PA news agency, although you should still make every effort to make voluntary contributions by April 5, but the DWP will "take an understanding approach and consider whether to accept payments received after the deadline".
The new state pension was introduced on April 6, 2016 but many people are missing national insurance years. Here's everything you need to know about the scheme:
Why might you have a gap?
You may have gaps or part years in your NI record for a number of reasons, such as if you were a low earner and did not pay NI or if you were unemployed but not claiming benefits. Those who were self-employed or worked abroad may also have gaps in their record.
How to check if you're missing NI years
You can check your state pension summary on Gov.uk. Just fill in your details and it will tell you whether your pension is forecast to be at the full state pension level. You can also check your national insurance record on Gov.uk.
Check if you're due free national insurance credits
You may be able to get missing years back without paying for them if for example, if you were a carer, you had childcare responsibilities or an illness which prevented you working for a time. Check in the National Insurance credits section of Gov.uk
You can buy more years if you need them
If you can't get your missing years made up for nothing, you can buy them. The standard cost of buying National Insurance contributions is £15.85 for a week of missing contributions in the 2022-23 tax year. It would cost you £824.20 for an entire year.
However, if you are looking to fill gaps that occurred in the past two tax years, you would pay the rate from those years. Voluntary contributions for gaps in 2021-22 cost £15.40 per week; for gaps in 2020-21, the cost is £15.30 per week. For those able to fill gaps between 2006 and 2016, the cost for a week is £15.40.
You can find out how to pay here.
How many years NI contributions are needed for a full pension?
You now need 35 years of NI contributions to qualify for the full state pension, which is worth £185.15 a week in 2022-23. To qualify for any state pension at all, you need 10 years of contributions.
To get the latest money news direct to your inbox, click here.
Now read:
- Universal Credit claimants could lose £1,000 under DWP trial
- Cost of living: A five-step plan to get debt free in 2023
- How to work out how much your heating costs per hour
- All the big money changes to look out for in 2023 month by month
- DWP Universal Credit claimants hit as sanctions rise by 250% amid claims they are 'back with a vengeance'
