National Insurance and your State Pension forecast

Your State Pension forecast may be affected by National Insurance rules. Find out about rules for topping up your National Insurance contributions, reduced rate and when you have to pay National Insurance. If you need further help you can contact HM Revenue & Customs (HMRC).

Paying National Insurance

Working

Even if you already have enough qualifying years to get a full State Pension, you have to pay National Insurance until you reach your State Pension age if you:

  • work for an employer and your wages are above a certain level
  • are self-employed and earn more than the Small Profits Threshold

The Small Profits Threshold for 2017/18 is £6,025. This figure is updated yearly.

Paying voluntary NationaI Insurance contributions

If you are paying voluntary National Insurance contributions you may decide to stop paying them if you already have enough qualifying years to get a full State Pension.

You can pay voluntary contributions to fill or avoid gaps in your National Insurance record.

You may have gaps because:

  • you’re ill and not working and don’t get any benefits
  • you’re unemployed and don’t get any benefits
  • you live abroad and don’t have to pay National Insurance
  • you’re self employed, making a profit under the Small Profits Threshold and don’t have to pay National Insurance

If you stop paying voluntary National Insurance contributions, your widow, widower or surviving civil partner's bereavement benefits may be affected if you die.

Reduced-rate National Insurance

In the past, married women (and some widows) could choose to either:

  • pay reduced-rate National Insurance contributions as an employee
  • not pay Class 2 National Insurance contributions when self-employed

Although this stopped in 1977, women who were already paying the reduced-rate National Insurance could continue to do so.

Reduced–rate National Insurance contributions do not count towards the State Pension. You can't normally get Home Responsibilities Protection for any period covered by reduced-rate National Insurance contributions. Since April 2010 you may be able to get the credits for parents and carers that replaced Home Responsibilities Protection.

You will stop paying reduced–rate National Insurance contributions if you:

  • get divorced or your marriage is annulled (officially cancelled)
  • stop being entitled to certain bereavement benefits
  • ask to stop paying reduced–rate National Insurance contributions

You will also stop paying reduced–rate National Insurance contributions if, for two tax years in a row, you:

  • did not earn enough to pay, or be treated as paying, National Insurance contributions as an employee
  • were not self-employed

If you need advice about reduced-rate National Insurance contributions, contact HMRC.

Topping up your State Pension

If your forecast shows you may not receive a full State Pension, you may be able to top up your State Pension. You can do this by making voluntary National Insurance contributions. This may be useful if you have missed paying NI contributions, for example because you weren't working, or were outside the UK. Details will be included in your forecast if this applies to you.

There are time limits for paying voluntary National Insurance contributions. You can usually fill gaps in the previous six tax years.

Rules for voluntary Class 3 National Insurance contributions

Since 6 April 2009, some people paid additional voluntary Class 3 National Insurance contributions. These may be paid in addition to any you may pay for the previous six tax years. You may be able to do this for up to six years from 6 April 1975, if you:

  • reach State Pension age between 6 April 2008 and 5 April 2015
  • already have 20 qualifying years (including years of Home Responsibilities Protection)

You cannot pay additional Class 3 NationaI Insurance contributions for any tax year if the whole year is covered by reduced-rate National Insurance.

Further questions

If you have any further questions about your National Insurance contributions or credits, contact HMRC.

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