Don’t miss the deadline to increase your state pension by up to £55,000

It’s easy to take your state pension for granted. But the truth is that after decades of hard work, every year people reach retirement age and then realise that gaps in their National Insurance record mean they are paid much less than expected.  

The good news is that once you identify the gaps in your NI record, you can fill them in – and for the next few months there is a rare window to pay missed contributions going all the way back to 2006. 

Sacrificing a bit of time to sort out this admin could add tens of thousands of pounds to your retirement income – here’s how to do it.  

How do I know what my state pension will look like? 

The first step is to check your state pension forecast. You can do this by visiting the government website at: https://www.gov.uk/check-state-pension

If you have gaps in your National Insurance record, then your forecast will look smaller. You need a 35-year track record to qualify for the full state pension, which for many people will exceed £10,000 per year in the spring. 

You can check your National Insurance record here: https://www.gov.uk/check-national-insurance-record. In order to do so, you will need a Government Gateway user ID and password. 

You can also request a printed National Insurance statement online, by post if you live abroad or by phone. The government guide to calling the helpline is here: https://www.gov.uk/government/organisations/hm-revenue-customs/contact/national-insurance-enquiries-for-employees-and-individuals

You can also write to HM Revenue and Customs to request a statement at this address: 

National Insurance contributions and Employers Office
HM Revenue and Customs,
BX9 1AN

You might have gaps if you lived abroad, were unemployed or self-employed or a married woman or widow who stopped paying reduced rates of NI, sometimes called the ‘small stamp’ when they were phased out in 1977. 

Here’s a table to check if you are eligible for NI voluntary contributions. Remember, these are different criteria for NI credits, which allow you to claim money for your record rather than pay up. 

If you think there are gaps in your record, you must check if paying voluntary contributions is the right route for you, as in some cases they do not always boost the state pension and you could be wasting money. 

If you think this could be a risk, check with the Government’s Future Pension Centre. Make sure you do this well in advance of the deadline on April 5 2025. The deadline has been extended several times amid reports of a significant backlog building on their helpline – it was originally set for April 2023. 

You can reach the Future Pension Centre on 0800 731 0175, or +44 (0)191 218 3600 if you are calling from outside the UK. The line is open from 8am to 6pm. 

The Centre also offers an online form that you can fill out to make an enquiry, although you cannot request a state pension forecast through this. 

How much do I have to pay, and what could I get? 

The deadline for NI catch-up payments for the tax years from 2006-07 to 2015-16 is April 5 2025. A six-year deadline usually applies to fill missed contributions, but a change to the state pension in 2016 has created a one-off longer concession. 

The standard cost to make up a year of missing NI contributions is £824.20, although the self-employed pay just £163.80. 

The full flat-rate state pension is currently £185.15 a week. Someone who has made 25 years of NI contributions rather than the 35 years needed for a full state pension would get £132.25 a week. 

Topping up all the gaps from 2006-07 to 2015-16 would give an extra £52.90 a week or £2,750 a year, or around £55,000 extra in total, over a 20-year retirement. 

Some years cost less to top up than others: for example, if you worked part-time and paid some NI, then that would be cheaper to fill than a completely blank year.

Sir Steve Webb, former pensions minister and now partner at the consultancy LCP, said: “It may seem like a hassle but is worth it. You will kick yourself if you have missed a chance to boost your retirement income substantially and relatively cheaply.

“The key thing about voluntary NI contributions is that they are subsidised by the Government. It is a profitable transaction because the Government is selling it to you below cost.” 

Sir Steve added that it was unwise to leave any contributions for 2006-07 to 2015-16 to deadline day. 

“Many people are finding it long or difficult to get through to helplines at the minute,” he said. “Don’t leave it to the last minute as after the legal deadline there is no plan B.” 

Should everyone pay voluntary NI contributions? 

While there is a window of opportunity to boost your NI record, it will not make sense for everyone to pay extra contributions. 

For people who do not plan on retiring in the near future, the pay-off may be limited. If you have many more years ahead of you in the workforce, then you cannot get the money back if you overpay and you will likely make up the contributions through work anyway. 

If you are in ill health, then you may not be drawing on the state pension for very long and spending your cash now may not work to your advantage. Sir Steve added that if anyone claims benefits, then boosting your retirement income could have the adverse effect of reducing your other payouts. 

Have you had trouble getting through to the Future Pension Centre or HMRC about your state pension? We want to hear from you. Email: lauren.almeida@telegraph.co.uk

This article was first published on February 25 2023, and is kept updated with the latest information.