As retirement approaches, you must check that your state pension forecast and national insurance record are correct. Tiny discrepancies will result in pension deficits or additional expenses you may not have anticipated.
Anyone who assumes their records are accurate could be in for a shock – one woman had to fight HM Revenue and Customs when she found out her pension would be cut due to discrepancies between the P60 form issued by her employer and Government Gateway. When issues like this arise, it is always best practice to review records for irregularities regularly. This helps protect your financial future.
We will now see the process of getting this information from your State Pension and NI record easily.
Look Into Your Records
There are two main places to find your NI record:
- Check your full NI record year-by-year on the DWP website and get a forecast of what you’ll receive.
- Use the link on HMRC’s ‘Check your National Insurance record’ page.
Assess the years in which you were employed or self employed for the whole year and paid the relevant NI contributions—they should show up as a ‘full year’. Similarly, any years where you weren’t working but were eligible for NI ‘credits’ for the entire tax year should also be marked as ‘full.’
Verify Which Years Are “Not Full”:
The years that should be your main emphasis are the ones that appear to be “not full” (see the list for an example NI record).
- 1986 – 1987: Full Year
- 1985 – 1986: Not Full
- 1984 – 1985: Not Full
- 1983 – 1984: Full Year
At times, it can be possible that a year is not ‘full’. Examples can include:
- You only worked for a few months a year and did not earn enough in that period to create a full year of NI contributions.
- You were outside the UK and not paying national insurance contributions
- You were in higher education full-time; for example, the person above was at university in 1984/85 and then again in 1985/86, so there will be a gap in their record.
- When the ‘wrong’ partner in a couple claims child benefit, resulting in the National Insurance credit being allocated to the higher earner instead of the stay-at-home parent with the children who actually need the credit.
- If you are employed and paid the reduced ‘married woman’s stamp’ rate of NI contributions in that year.
Self-employed individuals often trust that their accountant will handle everything, including National Insurance contributions. However, it’s crucial to ensure that these payments are properly managed. By working closely with a knowledgeable accountant, you can have peace of mind knowing that your contributions are being accurately tracked and paid, safeguarding your financial future.
Pinpoint Any Potential Errors:
When any year appears as “not full”, there can be some error.
Examples would include:
- Your employer failed to tell HRMC about your NI contributions.
- If you made voluntary NI contributions for a year, but they haven’t been reflected in your record.
- In case you are supposed to receive ‘credits’ yet these have not been credited, for instance, many people are disadvantaged by missing the automatic NI credits they should be getting.
In addition to years listed as ‘full’ or ‘not full,’ in some instances, a year is classified as “still being checked,” and this can be the case many years after an event.
Keep in mind that the NI data from the previous year may not appear on the website for several months after the year ends, so wait until fall before raising concerns about the non-display of that year’s information.
Address any possible errors:
Here is what to do with the information you may have learned during the above checks:
- If you believe there is an error in your record — for example, you know that you worked a full year and paid NI contributions, but the year is shown as ‘not full’ — then you should contact HMRC and challenge this.
Having paperwork such as P60s can help resolve matters. - If you believe you should have been getting NI credits for a given year, then you should also query HMRC about this.
The official UK Government’s website provides a summary of who is entitled to NI credits here.
In some cases, you may not be getting credits because they are not awarded automatically and you have not applied for them (for example, the ‘grandparent credits’ available to certain family members who look after a child). In this case, it may be possible to make a backdated claim for credits, but the rules on backdating vary depending on the type of credit.
- If a year is shown as ‘still being checked,’ then you should contact HMRC to find out what further information they need. The NI helpline number is 0300 200 3500.
- If the year correctly shows as ‘not full,’ you may still be able to pay voluntary NI contributions to make it into a full year. Until 31 July this year, you can go back as far as 2006/07, but after that date, you will only be able to go back six years.
Unfortunately, we are still hearing from people who are having difficulty speaking to the Future Pension Centre about making voluntary contributions, so you may have to persist.
Check In The Future And Keep The Paperwork:
This is far easier to deal with if you check often and keep all your paperwork.
Trying to resolve matters relating to a year going back decades and for which you no longer have any paperwork can be difficult, if not impossible.
Need More Help? Speak to Taxcan Accountants And Cangaf Ltd.
All set to check your state pension and National Insurance record? You can skip all the hassle with TaxCan Accountants and Cangaf Ltd. It’s easy to get started. You will receive an in-depth consultation that meets your requirements and fully addresses your financial problems.
We tailor our solutions to both individuals and businesses in the United Kingdom, providing personalised attention instead of one-size-fits-all methods.
So don’t wait—book your appointment today and secure your financial future.
