Ten tips for reluctant investors | SavvyWoman.co.uk

How to pay voluntary National Insurance contributions

Font size


If you know you’re not likely to get the full state pension when you retire, can you do anything about it? Well, paying additional, voluntary National Insurance contributions may help. Find out how to pay voluntary National Insurance contributions.

How to pay voluntary National Insurance contributions

If you’ve had periods of not working but you’ve not been able to claim benefits or you’ve not done so, it might be worth paying voluntary National Insurance contributions.

SAVVY TIP: If you reached state pension age before April 6th 2016, you need 30 years’ National Insurance to receive a full basic state pension. You either need to have paid NI yourself or to have been credited with it if you’ve been acting as a carer or have been a full time mum. If you reach state pension age on or after April 6th 2016 you’ll need 35 years of National Insurance to get the flat rate (although it’s a bit more complicated than that).

Other situations when you might want to make additional voluntary NI contributions are when you’ve worked but haven’t earned enough to pay NI in the first place or when you’ve been living abroad.

SAVVY TIP: National Insurance comes in different classes. When you make additional, voluntary National Insurance contributions, you normally pay class 3 contributions, but you may pay class 2 if you’re self employed or live abroad.

When can’t you pay voluntary National Insurance contributions

Not everyone can make additional National Insurance contributions. The most common situation when you can’t pay voluntary National Insurance contributions is if you’ve paid the married women’s stamp (reduced rate National Insurance). For each tax year you’ve paid that, you’re not able to make voluntary contributions.

SAVVY TIP: You’re also not able to make voluntary NI contributions in the tax year that you reach state pension age.

How much do voluntary contributions cost?
If you want to pay voluntary National Insurance contributions for the 2017-18 tax year you’ll have to pay:

– £14.25 a week for class 3 voluntary contributions
– £2.85 a week for class 2 contributions

Paying voluntary National Insurance you’re self-employed

If you’re self-employed you can choose to pay class 2 voluntary National Insurance contributions even if you don’t have to pay them. If you want to pay voluntary NI contributions, it’s better — in general terms – to pay class 2 contributions than class 3, not least because it’s cheaper.

Deadlines for making voluntary NI contributions

Normally you have to make voluntary National Insurance contributions within six years of the tax year you’ve got gaps in your record for. So, for example, in the tax year 2017-18 you could make voluntary National Insurance contributions going back to 2011-12.

Paying voluntary National Insurance you’re living abroad

If you’re living abroad you may be able to fill in the gaps in your National Insurance record by buying voluntary contributions. In broad terms:

  • While you’re abroad: You can normally continue paying UK National Insurance contributions voluntarily.
  • The three year residence rule: You must have lived in the UK for a continuous three-year period at any time before making your payments
  • The three year NI rule: You must have paid National Insurance contributions for three years or more before you went abroad.

SAVVY TIP: If you are abroad or have been abroad and want to find out whether you have a shortfall, contact the International Pension Centre.

Why pay National Insurance when you’re abroad?

If you move abroad, continuing to pay UK National Insurance contributions may help keep your entitlement to:

  • Certain state benefits. This is mainly in the European Economic Area (EEA) but it also applies to some other countries where there is a reciprocal agreement with the UK.

Certain state benefits and allowances when you return to the UK
A full state pension

How to apply to make voluntary contributions if you live abroad

You can apply using form NI38 (which you can get from the Gov.uk website)

How to pay voluntary NI contributions if you live abroad
There are two ways you can pay voluntary National Insurance contributions:

  • via Direct Debit every four or five weeks
  • with an annual payment

Related articles:

Raising the state pension age to 66; when can you expect your pension?

National Insurance credits – NI credits could increase your state pension

Is it worth deferring your state pension?

SavvyWoman email newsletters: If you found this information useful why not sign up now to receive free fortnightly email newsletters with money saving tips and help? You can sign up at the top of any page on the website and your details won’t be passed to any other company.