Deadline to back pay U.K. state pension approaching

[soundofsilver]

Great - thanks!

[kuma]

Just to note that the gov.uk page regarding the extension has been recently added to:
https://www.gov.uk/government/publicati ... s-deadline

It includes the publication of an email address:

If you have any questions about this change, contact the National Insurance contributions Policy Team at: nics.correspondence@hmrc.gov.uk.

[mc_spanner]

I just heard about this opportunity to fill gaps in the NI contributions history. I am racing to get this done in time ... Forgive me for asking things which I'm sure have been answered in existing threads.

1) Is it worthwhile to fill the gaps in my contributions history?
I guess the answer to this is "Absolutely, yes!" But please let me know if I am missing anything -
I have 18 fully paid years of contributions, and I can make voluntary contributions to cover three years in the distant past (2006 to 2007, 2007 to 2008, and 2008 to 2009), and two years in the recent past (2020 to 2021 and 2021 to 2022). If I continue to make voluntary payments I should reach the 35-year max right around the time I retire.


2) What are my next steps?
As a resident of Japan, it seems that I must complete the CF83 form and send it to HMRC. I'll try to use a trackable method.
I understand that I should be allowed to fill in the gaps in my contributions, provided it reaches HMRC before the July deadline.
Did I get that right?

3) What happens then?
Do I have to wait for HMRC to contact me?

[kuma]

I just heard about this opportunity to fill gaps in the NI contributions history.

Welcome! Great that you are taking steps to improve your UK state pension, and especially given that you are intending to use this special extension period!

I am racing to get this done in time ... Forgive me for asking things which I'm sure have been answered in existing threads.

No problem. I reckon there must be almost 1,000 forum posts on the UK state pension, which is a lot of discussion to parse. The wiki article on the UK state pension is a central place for key information. Feel free to ask questions.

1) Is it worthwhile to fill the gaps in my contributions history?
I guess the answer to this is "Absolutely, yes!" But please let me know if I am missing anything - I have 18 fully paid years of contributions, and I can make voluntary contributions to cover three years in the distant past (2006 to 2007, 2007 to 2008, and 2008 to 2009), and two years in the recent past (2020 to 2021 and 2021 to 2022). If I continue to make voluntary payments I should reach the 35-year max right around the time I retire.

Absolutely, yes!

[Sometimes there is the proviso that if you return to the UK and pay mandatory NICs while working there, you could end up with more than the 35 qualifying years required for the full state pension, in which case some voluntary years could be seen as inefficient or redundant. But in your case it sounds like you have just enough years before retirement age to reach the 35 years of coverage, whether or not said qualifying years are abroad or in the UK. So duplication is pretty much a non-issue. And even if it were, my personal opinion would be to bank the qualifying years in any case; it's such a good deal, and plans can change (eg a provisional UK return could be cancelled). Many UK-based individuals greatly exceed 35 qualifying years in any case.]

2) What are my next steps?
As a resident of Japan, it seems that I must complete the CF83 form and send it to HMRC. I'll try to use a trackable method.
I understand that I should be allowed to fill in the gaps in my contributions, provided it reaches HMRC before the July deadline.
Did I get that right?

Yes, that's all correct.

The wiki contains notes on CF83.

Do you think you'll qualify for Class 2 or Class 3 contributions? (With 18yrs of contributions, sounds like Class 3 is in the bag, and Class 2 would depend on criteria #1 and #3 below.)

Voluntary Class 2 NICs from abroad: eligibility criteria
All three of the below conditions must be met:
1. You’re employed or self-employed outside the UK, and
2. You’ve lived in the UK for a continuous 3-year period at any time before the period for which NICs are to be paid*, or
before going abroad, you paid a set amount in NICs for 3 years or more (this will be checked when you ask to pay Class 2 NICs*), and
3. Immediately before going abroad, you were ordinarily an employed or self-employed earner in the UK.

* time spent in the EEA, Switzerland or Turkey may count

Voluntary Class 3 NICs from abroad: eligibility criteria
One of the following conditions needs to be met:
1(a) You’ve lived in the UK for a continuous 3-year period at any time before the period for which NICs are to be paid*, or
1(b) Before going abroad, you paid a set amount in NICs for 3 years or more, or
1(c) You've paid Class 1 contributions for the first 52 weeks of your employment abroad

* time spent in the EEA, Switzerland or Turkey may count

If Class 2 looks likely, what were your employment circumstances before leaving the UK (criterion #3)?

Are you able to compile your work history since leaving the UK, with exact dates?

Yes to using a trackable method. Keep a copy of anything you send to them (including CF83 and covering letter).

One point some forum members make is that sometimes HMRC requires applicants to jump through the hoops of applying for a state pension forecast and proving that voluntary contributions could improve the forecast, before HMRC accepts voluntary payments. The table of state pension-related actions in the wiki includes methods for applying for the forecast, and the info above the table also provides an HMRC phone number which forum members report being more likely to be answered than the main published number.

3) What happens then?
Do I have to wait for HMRC to contact me?

Yes, be prepared for a lengthy wait. Eventually, if accepted, you can expect a letter giving details of (a) ongoing payments according to the method you selected on CF83, and (b) back payments. I think these letters usually give a deadline of 8 weeks for the back payments to be made at the rates stated in the letter... of which half that time might be 'in the post'.

There may be nuggets of info on the HMRC Community Forum for NI contributions regarding processing times, etc. And there will no doubt be discussions on the RJ forum, as several members have applied in the last few months.

[mc_spanner]

Thanks so much for your response. Actually, I sent the CF83 first thing this morning before reading your post ... In Q22, ( wish to apply to pay voluntary contributions) I checked the box for Class 3 only.

Do you think you'll qualify for Class 2 or Class 3 contributions? (With 18yrs of contributions, sounds like Class 3 is in the bag, and Class 2 would depend on criteria #1 and #3 below.)

I thought that Class 2 was for self-employed people. In terms of the eligibility, it looks like I meet the three criteria that you listed:
1. You’re employed or self-employed outside the UK - YES. I'm employed in Japan.
2. You’ve lived in the UK for a continuous 3-year period at any time before the period for which NICs are to be paid - YES. Lived in UK from 2009 to 2019
3. Immediately before going abroad, you were ordinarily an employed or self-employed earner in the UK - YES. Self employed immediately before coming to Japan.

I suppose I'll be able to rectify this with HMRC in the future? The most important thing right now is to meet the deadline for filling the gaps in my NIC history.

[kuma]

Thanks so much for your response. Actually, I sent the CF83 first thing this morning before reading your post ... In Q22, ( wish to apply to pay voluntary contributions) I checked the box for Class 3 only.

Do you think you'll qualify for Class 2 or Class 3 contributions? (With 18yrs of contributions, sounds like Class 3 is in the bag, and Class 2 would depend on criteria #1 and #3 below.)

I thought that Class 2 was for self-employed people. In terms of the eligibility, it looks like I meet the three criteria that you listed:
1. You’re employed or self-employed outside the UK - YES. I'm employed in Japan.
2. You’ve lived in the UK for a continuous 3-year period at any time before the period for which NICs are to be paid - YES. Lived in UK from 2009 to 2019
3. Immediately before going abroad, you were ordinarily an employed or self-employed earner in the UK - YES. Self employed immediately before coming to Japan.

I suppose I'll be able to rectify this with HMRC in the future? The most important thing right now is to meet the deadline for filling the gaps in my NIC history.

Re Class 2 eligibility #3, were you self-employed (and/or employed) for a considerable length of time in the UK before heading abroad? Any major gaps? (Asking to check that this criteria is watertight, as likelihood of acceptance might affect decisions to push for Class 2 either now or later.)

Class 2 and Class 3 rates are very different (Class 3 costs approx 5 times as much as Class 2), so it's definitely in your interests to change at some point. Whether attempting to do so now or later is up to you; some info below:

I can make voluntary contributions to cover three years in the distant past (2006 to 2007, 2007 to 2008, and 2008 to 2009), and two years in the recent past (2020 to 2021 and 2021 to 2022)

The 31st July 2023 deadline will see the window closed for pre-2016 contributions. So, if you elect NOT to attempt to re-apply for Class 2 now, you could wait for your acceptance, then pay 2006/7, 2007/8 and 2008/9 at Class 3 to get those years credited during this unique opportunity, then re-apply as a Class 2 applicant (potentially cancelling any direct debit instructions if you opted for that payment method). When you reapply, you'd be able to cover 2020/1 and 2021/2 for up to 6 years after the tax years in question, so those payments are less urgent. The payments are entirely voluntary so you do NOT have to pay everything that you are eligible for.

Another strategy would be to immediately send in a fresh application for Class 2 with a covering letter explaining that you wish to cancel your previous application for Class 3 and proceed with this application for Class 2.

Those 3 historic years would each cost £163.80 at Class 2 or £824.20 at Class 3, which is £491.40 v £2,472.60 for 3 years.

[mc_spanner]

Another strategy would be to immediately send in a fresh application for Class 2 with a covering letter explaining that you wish to cancel your previous application for Class 3 and proceed with this application for Class 2.

Those 3 historic years would each cost £163.80 at Class 2 or £824.20 at Class 3, which is £491.40 v £2,472.60 for 3 years.

Thanks again for your help. That's a significant chunk of change ... I decided to send in a fresh application for Class 2 and asked them to cancel the first one. I hope this won't confuse them.

[kuma]

Another strategy would be to immediately send in a fresh application for Class 2 with a covering letter explaining that you wish to cancel your previous application for Class 3 and proceed with this application for Class 2.

Those 3 historic years would each cost £163.80 at Class 2 or £824.20 at Class 3, which is £491.40 v £2,472.60 for 3 years.

Thanks again for your help. That's a significant chunk of change ... I decided to send in a fresh application for Class 2 and asked them to cancel the first one. I hope this won't confuse them.

Good luck! Watch them like a hawk. I'd advise to keep records of any correspondence, including phone (take the name and job title of anyone you speak with and write down any key points from conversations).

[kuma]

https://community.hmrc.gov.uk/customerf ... 155d9771aa

Boy oh boy! That thread is quite a masterpiece in dancing dates even by HMRC's standards!

Kudos to the applicant's mother for her persistence.

if post was held in an incorrect work queue, then moved into the correct work queue this can have an affect on the dates

Not circulating to scare people; but this gives an indication of the scale of the current backlog and of some of the communication loops some people find themselves in with HMRC.

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In better news, NI38 has finally been updated with the extension.

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For the record, I did try contacting the National Insurance contributions Policy Team on the email address published here on 31st March with 2 queries (1. when will NI38 display the extension?; 2. Could you confirm whether applications received prior to the deadline will be honoured and eligible for payments?) but have not yet had a response. Given that #1 is now effectively answered (NI38 was updated on 12th May), I thought I'd chase #2:

Could it be formally published whether applications received prior to the deadline will be honoured and eligible for payments at the rates at the time their application was received?

Certain individuals seem to be able to get favourable answers to this from HMRC (eg1 https://community.hmrc.gov.uk/customerf ... 155d975688, eg2 viewtopic.php?p=29152#p29152), but I cannot see the policy formally published, and many people no doubt seek authoritative information on this point. If it is already published, please could you guide me towards this information.

I'll post if I hear anything.

[mc_spanner]

Good luck! Watch them like a hawk. I'd advise to keep records of any correspondence, including phone (take the name and job title of anyone you speak with and write down any key points from conversations).

I tried calling earlier this month and was repeatedly cut off after waiting on hold for 30 minutes. I understand that there's a better number to call, but is there any reason to call? What should I ask them if I get through? The site tells me that I'll get a reply in February next year.

I'm astonished at the backlog ... but if I call, will I be able to get anything from them other than "wait until February?"