Could a National Insurance gap impact your pension?

Have you ever worked abroad?

If you have had a period of time working outside of the UK, it is worth reviewing those periods to see whether you had been paying the local equivalent of that country’s social security contributions, instead of UK NICs. In doing so, you may have created a gap in your UK NIC record and consequently fall short of the State Pension entitlement that you were expecting.

Have you taken a career break?

If you have taken a career break – for example, to care for loved ones or live off a windfall or inherited wealth, you may have a hole in your record. Likewise, there may be gaps in NICs for those with fluctuating profits if there are periods of particularly low profits or losses. In such cases, it is easy to overlook potential gaps and fall short of the crucial number of qualifying years.

For those with gaps in their NIC record, all is not lost!

This is where voluntary NICs come into play. If eligible, you can plug the gaps in your NIC record to restore your State Pension entitlement by way of voluntary contributions. You should note, however, that HMRC will generally only allow you to remedy gaps within six years of the end of the tax year in which the gap occurred, so action should be taken sooner rather than later.

You should regularly check your National Insurance position to ensure that no gaps appear in your record. If you would like to assess whether voluntary contributions may be of benefit to you, please fill out the form below.