National Insurance Record, Can I Buy Back Missing Years?

questionmark1Q. I will reach state pension age in 11 years and the state pension statement I have just received shows that I have accrued 20 years national insurance credits as at 31/3/15.

Therefore, I will fall short of the 35 years required to qualify for a full state pension under the new system which was introduced on 6/4/16.

This is partly as I’ve just returned from a stint working abroad for 4 years.

I have heard that it may be possible to pay additional national insurance to, effectively, ‘buy’ the missing 4 years.

Is this correct?

A. This is a great question, especially as the new state pension system is anything but straightforward!

Firstly, some background is necessary.

The new ‘single tier’ state pension has been introduced to sweep aside the complex system that was in place, as well as to potentially pay a higher amount to those that qualify (when compared to the ‘old’ system).

We say potentially, as the old system may in fact pay more than the new one, certainly initially for some.

We don’t have the time to discuss the ins and outs of the ‘new and old’ state pensions now, so we’ll concentrate on the question in hand.

You will be able to pay class 3 National Insurance contributions to buy the missing 4 years (you can usually only pay for gaps in your National Insurance record from the past 6 years).

The first step is to request a state pension statement, which will let you know how many years credit you have.

This won’t show you if you have any missing years (although in your case you know you’ll be missing the last 4), so you’ll need to ask for a National Insurance statement online.

As an example, below is the record of a client which shows that he had 1 missing week from one of the years! (it states ‘Tax Year Under Investigation’)



Therefore, if he hadn’t checked, he would have missed out on that year’s credit.

In fact, this happened as he switched from self employed to a limited company and did not pay his class 2 national Insurance for the last week of the tax year (due to his limited company being effective from April 1st).

The last step is that HMRC will write to you to let you know if you can make voluntary contributions, as well as how much you’ll need to pay.

Ray Prince

My work passion is helping dentists and doctors strategically plan their financial futures in a totally impartial way (I work on a fee basis). Outside of work the best words that can describe me are: father, husband, keep fit enthusiast (running), family oriented, non-materialistic, enjoy new challenges, smiling, living by the coast 🙂

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