RetireJapan

Hello RetireJapan,
I'm looking into back paying my National Insurance contributions.... and would of course like to be paying the cheaper Class 2 contributions.

My question is, does anyone know how much of a difference it makes to their assessment of you if your answer to the Ordinarily Resident of the UK is 'Yes' or 'No'? Would a 'No' answer lean more towards Class 2 or 3 repayments -or does it not even work like that?

In the brochure that comes with the assessment forms it says to base your answer on your situation prior to leaving the country -well sure, prior to leaving the UK, I had lived, worked, and studied there my entire life so my answer would be 'Yes'. Now, 15years after living in Japan with a house, family etc. I certainly wouldn't class myself as an ordinarily resident of the UK...

If anyone has any insight, I'd appreciate it...
Thanks.

It's highly unlikely you could be ordinarily resident in the UK in your current circumstances, and remember, if you are, you will be liable to pay tax there.

I haven't seen the assessment forms but does it not mean that you can only pay in if you were ordinarily resident in the UK prior to moving to your current location? That is, your status then gives you the right to pay, while your status now will determine the type of payments you can make.

goodandbadjapan wrote: ↑Wed Oct 03, 2018 1:36 am I haven't seen the assessment forms but does it not mean that you can only pay in if you were ordinarily resident in the UK prior to moving to your current location? That is, your status then gives you the right to pay, while your status now will determine the type of payments you can make.

Hey goodandbadjapan! Cheers for the reply...

I initially called the HM Revenue & Customs to inquire about back paying my National Insurance contributions, and that I was living abroad and had done for a fairly long time. They told me to download .pdf NI38 which has the assessment form CF83 at the back.

From that .pdf we get this:




And on the actual assessment form, the question is just: Are you ordinarily resident in the UK?



At the time I left the UK, I would've had to say 'yes'. But 15years later, surely the answer is 'no'...?

Lovely and clear info from HMR&C! I'd probably just phone them up and get them to tell me what to do! I had to do a similar form for declaring CGT once, but that was very clearly for tax purposes, not NI and pensions..

Just noticed you had already called them! I'd still call them again and make them explain what you should fill in.

goodandbadjapan wrote: ↑Wed Oct 03, 2018 3:03 am Just noticed you had already called them! I'd still call them again and make them explain what you should fill in.

Good idea -I think that's probably the best course of action...
Thanks for the input!

I had the same internal dilemma, but i decided to say yes because i waa tax resident in the uk when i left 8 years ago.

Spoiler alert - i'm now backpaying class 2s

Bushiman wrote: ↑Wed Oct 03, 2018 2:14 am At the time I left the UK, I would've had to say 'yes'. But 15years later, surely the answer is 'no'...?

Sound like a no to me.

I'm pretty sure I said no to that, and I'm on class 2. I'll check my files next time I get the chance to see.

Thanks for all the input guys!
From that table of factors I linked above(Table 8), I could argue my case for both 'yes' and 'no'. If it doesn't matter which category I fall under to be considered for Class 2, maybe I'll put 'no', but outline my situation in the cover-letter...

Only other thing that concerns me now is the 'working immediately prior to leaving the UK' stipulation...
Well, I worked 4 full years (class 2 requires 3), then 2 part-time as I studied at University, then stopped for a year to concentrate on my studies for the final year, then straight out to Japan...

Bushiman wrote: ↑Wed Oct 03, 2018 11:43 pm Then stopped for a year to concentrate on my studies for the final year, then straight out to Japan...

This is probably going to disqualify you for class 2 unfortunately.

But if it helps, class 2 is a loophole. It's the non-employee "working" category but it's really designed for self employed people, hence the working immediately before requirement. If you were not working, they assume voluntary contributions are needed, which is class 3. The only reason class 2 is so cheap is because it's expected that you'll top it up with much more expensive profit-based class 4, but non residents don't pay that. So from the planning point of view, class 3 was supposed to be cheaper than class 2 (plus class 4).

Anyway looks like you should budget for Class 3.