UK Pension & Voluntary Payments Questions

[Tkydon]

When do the annual bills for Class 2 usually arrive?

I also set up a direct debit but for some reason ended up with annual payments. A minor inconvenience that for me isn't worth filling in forms or calling the nice people at the pensions service.

Looking at my bank statement, I payed at the end of April in 2023 and the end of May in 2024, so I expect this year's bill will arrive sometime after mid-April.

Thank you! I don't see any point sending off another CF38 to apply for direct debit as I'm sure it would take longer than 6 months to process, so my direct debit form would become invalid (again!).

So long as your communications are received by them before the 5 April Deadline, I think you'll be OK, but you can call to confirm...

[RetireJapan]

I don't recommend Direct Debit. I used to be on them but for some reason HMRC cancelled it twice without telling me, so I had to reapply and back pay both times. The annual payment seems much more reliable.

[Deep Blue]

My Direct Debit also failed for some reason and it took me a few years to notice and try to get it fixed.

[Gareth]

Never had a problem with my direct debit.

I get a letter every February/March that details payments to be taken for the forthcoming year. I chose “twice a year” payments. After the second payment, my record is updated on the same day.

I highly recommend direct debit. There’s no stress of waiting for your record to update.

If you have had problems with your direct debit, I think you should try again. Once it’s working fine, you’ll never look back!

[RetireJapan]

Never had a problem with my direct debit.

I get a letter every February/March that details payments to be taken for the forthcoming year. I chose “twice a year” payments. After the second payment, my record is updated on the same day.

I highly recommend direct debit. There’s no stress of waiting for your record to update.

If you have had problems with your direct debit, I think you should try again. Once it’s working fine, you’ll never look back!

Twice bitten, never doing that again. It takes months to get things set up again and back pay the missed payments

[Roger Van Zant]

Never had a problem with my direct debit.

I get a letter every February/March that details payments to be taken for the forthcoming year. I chose “twice a year” payments. After the second payment, my record is updated on the same day.

I highly recommend direct debit. There’s no stress of waiting for your record to update.

If you have had problems with your direct debit, I think you should try again. Once it’s working fine, you’ll never look back!

Same here. I use NatWest, if that makes a difference.
Just got the annual letter you mentioned last week, actually!
I pay monthly.

[soundofsilver]

FWIW I submitted CF83 online in January and received a letter from HMRC last week confirming what I need to pay, though the process on actually paying is as clear as mud. It starts off:

"Before paying any shortfall, it is important to find out if your state pension will increase once you've paid voluntary National Insurance contributions (NICs). When you've paid the shortfall, please call the Future Pensions Centre to find out which tax year will count towards your state pension

but later also says:

Due to changes in the law, you need the Pension Service to confirm whether your State Pension will increase if you pay any shortfall

So anyway I called the "Future Pensions Centre" [*], and actually got through and they helpfully confirmed that yes, my pension will increase if I pay the shortfall (which I knew already because why else I am I doing this?...), and informed me (incorrectly, as I suspected) I'd need an 18 (?) digit reference code to make the payment with, and then they offered put me through to HMRC, which by some miracle actually happened, and HMRC said I need to use the code made up of NI number and name (details on gov.uk somewhere), and specifically:

- I need to make separate payments for Class 2 and Class 3
- Class 3 payments will take up to 8 weeks to be processed
- Class 2 payments can take up to a year to be processed
- as long as they get the payment(s) before April 5th, they will be credited
- they made a note in my file that I have informed them I am intending to make the payments

Hope this info is of use to anyone in the same situation.

This is indeed very helpful info - thank you!

I am in almost exactly the same situation. Just yesterday, I got the same letter with the same rather opaque comments telling me to call the Future Pension Center to "find out if your state pension will increase once you've paid voluntary National Insurance contributions (NICs)". I also received a list of the tax years I need to pay shortfalls for. I am unclear why I need to call them if they have already calculated and the NICs shortfall amounts I need to pay...

Anyway, I called the Future Pension Center and unfortunately, they need someone to call me back, and this could take up to eight weeks(!) More unfortunate is that my letter gives April 10 as the repayement date for about 11 tax years, and as the "payment date without penalty" for 5 others.

I explained this to the guy on the phone and he told me he had marked my file as "urgent", so hopefully I will get a call soon. However, I just wanted to ask:

• (Generally) What would you do in this situation? I am going to at least call back and see if I can get a bit more info. I really don't want to wait for 8 weeks only to find out I should have just paid the listed contributions.

• Has anyone had experience waiting for a call from the governement about this? Apparently they send text messages beforehand. Do they give a specific time they will aim to call?

• I know my call has been "registered" and the guy on the phone game me the exact time and date that I could use to prove this. Does this mean I kind of "extended my deadline" for payments?

Disclaimer: Yes, I left this way too late and it's my own fault, but any insight would be appreciated!

[adamu]

I am unclear why I need to call them if they have already calculated and the NICs shortfall amounts I need to pay...

You need 35 years of coverage to receive the full pension, but you can theoretically pay voluntary contributions for years even when you already have enough to qualify for the full pension. There's also the case where you pay the voluntary contributions to get 35 years coverage, then start working in the UK again and have to pay mandatory contributions anyway.

I've not made paid a shortfall myself, so I don't know if the call is a requirement or a guideline.

[soundofsilver]

Good points, thanks.

[allatsea]

I am in almost exactly the same situation. Just yesterday, I got the same letter with the same rather opaque comments telling me to call the Future Pension Center to "find out if your state pension will increase once you've paid voluntary National Insurance contributions (NICs)". I also received a list of the tax years I need to pay shortfalls for. I am unclear why I need to call them if they have already calculated and the NICs shortfall amounts I need to pay...

Anyway, I called the Future Pension Center and unfortunately, they need someone to call me back, and this could take up to eight weeks(!) More unfortunate is that my letter gives April 10 as the repayement date for about 11 tax years, and as the "payment date without penalty" for 5 others.

I explained this to the guy on the phone and he told me he had marked my file as "urgent", so hopefully I will get a call soon. However, I just wanted to ask:

• (Generally) What would you do in this situation? I am going to at least call back and see if I can get a bit more info. I really don't want to wait for 8 weeks only to find out I should have just paid the listed contributions.

From HMRC Forums:
"You must enquire to Future Pension Centre for confirmation that you paying any tax years will increase your State Pension."

Many sources state 35 years is the requirement to get a full UK pension. However, the UK pension system changed in 2016, so the number of years people need can vary greatly and buying pre-2016 years will not count necessarily count toward your pension.

From MSE Forums
" 35 years is the requirement only if you started your working life post-April 2016. If you were working before this and have not yet reached SPA,you may need as little as 29 years or as many as 49."

I wanted to make sure I met the 5 April payment deadline, so I paid all of my available years, then called the Future Pension Centre to confirm these years would increase my pension. They offered a call back, but I said I was in Japan so would really like an answer now. Success