National Insurance contributions and State Pension – what you need to know

As you know for every year you pay National Insurance you are adding to your qualifying years for when you claim your State Pension. This could be paying Class 1 through your Company PAYE scheme or paying Class 2 if you are self-employed (this includes partners in Partnerships).

Using your PAYE scheme means monthly or annual RTI (Real Time Information) submissions to HMRC. Having an amount of pay/salary in a set of accounts does not give you the National Insurance credit - the RTI needs to be submitted.

Class 2 should be included in your Self-Assessment Return.

It is not always the case that you must have actually ‘paid’ contributions, credits are received for various reasons, a low-income year or being a full-time parent claiming child benefit for example.

You need 35 qualifying years to claim the full state pension.

You can check your own National Insurance record by setting up a Government Gateway account. Here you can check any gaps and pay voluntary contributions to ‘top up’ gaps – but you can usually only go back 6 years. You can also check your State Pension Forecast using the portal here, which tells you when you can claim it.

We advise everyone to check this record even if you are sure that your qualifying years are all completed. This is particularly important for self-employed people as the system for paying Class 2 changed in 2015 and the transition was not always smooth. It is far easier to correct any errors prior to claiming your pension than once you are receiving it.

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