Buy back missed year on UK National Insurance, Class 2 or Class 3?

I had a call from DWP during the first year that I began receiving State Pension asking if I needed financial help as my State Pension was so low. I thanked him profusely and said I have a very generous pension as retired foreign diplomat so no need. But I was favourably impressed by the call. Which did not take account of the fact that we lived in Chelsea.

Let's see if I understand you correctly. I came here in 2002. I've got 19 year's Swiss contributions. 13 years more (hopefully).

Max out UK.

Max pillar one pension!

You can’t get double credit. If you qualify for a pension in U.K. (10 years) you can’t add Swiss years unless you don’t get a monthly pension from Switzerland.

And it was news to me although I’ve been getting State Pension from DWP for 15 years that it’s not monthly but every 4 weeks: thus 13x a year.

Stupid question:

If I left my uk pension at 9 years (which it is currently) does that mean they'd be counted as more valuable Swiss years?

Could it be worth not adding more UK years?

The general advice is to buy at least another year and get ten. Totalisation into your Swiss pension is a lesser value choice.

I'm confused now Caryl!

In previous discussions on this topic I had been under the impression that I could buy back missing UK years and continue to contribute, so that I would get the full UK pension, plus I would get whatever pension I am due from the Swiss system for what I estimate will be 21 years of contributions (according to the online calculator CHF 1250 a month). I already have 10 year's of full contributions in the UK.

Are you saying this is not the case?

I believe you are correct, the confusion is based on what happens if you don't have enough qualifying years in any country you lived in.

You can pay in arrears up to the past six years of any years in which you did not have full contributions (usually Class 1, employer-paid). Thus if you worked for a few months in, say, 2017 you can now pay the difference to get full credit for the year. And you can pay Class 2 or 3 contributions for subsequent years.

With a couple of rare exceptions you cannot pay missing contributions beyond the past six years.

Having credit for at least ten years of UK State Pension makes that pension eligibility totally independent of the Swiss, or any other, system in which you have qualified for a pension. Totalisation enters the picture where you have a few years in a treaty country but not enough for a pension. And as I wrote earlier you cannot totalise for a year in which you already have full credit in that other system (i.e. UK State Pension).

As you have ten years of UK credits you are entitled to something (currently around £200 or so a month). You can voluntarily pay Class 2 or 3 (as the case may be based on your circumstances and eligibility) until you have the maximum 35 years. https://www.gov.uk/voluntary-nationa...-contributions but don't be confused: you can not only pay missing back contributions but all future years. There's no point in paying for more than 35 years, that's the maximum credit.

The link I gave you leads to the application forms for Class 2 & 3. This is for Class 3: https://assets.publishing.service.go...370/CA5603.pdf

As I have written, the rules are arcane and you may want to speak to the authorities first: +44 191 203 7010

And also to note, the Gov Gateway only gives you the option to pay class3.

You don't need to pay class 3 if you are working here in CH.

This is where you need to contact them and start the process to pay class 2.

You need to contact HMRC anyway before paying because you need to have a reference number to pay.

https://www.gov.uk/pay-voluntary-cla...e/bank-details

As others have said, it's better (cheaper) to pay Class 2 if you can. The rules are arcane.

This page is what troubles me, especially with Class 2:

https://www.gov.uk/national-insurance-if-you-go-abroad

While you can claim exemption from NICs if you work in a Totalisation Treaty country, if you subject yourself to voluntary contributions that page (despite its notation of exemption in Treaty countries) can be read as stating that for the first 52 weeks you will be taxed at the rate of Class 1, the rate paid by employed persons and their employers in the UK.

https://www.gov.uk/national-insurance-if-you-go-abroad

I have not seen this applied to those seeking to pay Class 3 contributions, and the work that I have done was in relation to employers seconding persons abroad and agreeing to pay their NICs (both parts) while they were abroad.

For the low paid -- such as missionaries I worked with -- the contributions were cheap, sometimes close to zero. For highly paid executives it can be costly.

Meh. I've filled in the form and see what happens. I'll let you know.

Maybe worth to mention but the NI goes up in the UK next year, but only for a year, and not on Class 2, before returning to it's current rate.

https://www.gov.uk/national-insurance/how-much-you-pay

After this there will be a new Health and Social Care levy. They have not mentioned if they will adjust the current situation with voluntary payments.

As a reminder, if you were born after 1951, you have another @ 18 months where you have the opportunity to back pay from 2006 to 2016 , so 10 years or one third of the state pension. If you were working here, or anywhere EEA I guess, this would cost @£2500 in total and give you a yearly UK pension payment of +£3000

After April 2023, this window of opportunity closes.

I received acceptance of my application last week. I've got 14 year's contribution. I can buy another 15 year's of class 2 ~£160 per year. I pay for another 6 years (class 2) and that's full state pension.

I've just filled in the form for my wife. She's probably got around 14 year's contribution in the UK as well.

One of my friends got a refusal for class 2, but I don't know the details as to why.

Small update. While making the missing year payments from my Swiss account, there was a £7 bank charge. I got a letter from HMRC asking for the £7 so that final year can be fully paid off.

The confusion was that the letter was headed "Class 3 NI contributions".

I called the helpline, and the advisor assured me that the letter is in error, he can see the £7 shortfall on my NI contributions and it really is class 2 payments I'm making.

Tip: when I've called between 9:30 and 10:30 UK time, I've got through to a real person within about 5 minutes. (Unfortunately they have a lot of automated spiel before you get into the call queue).

Get a Revolut account or similar to make such payments, so you will be making a local UK "faster payment" and buying your GBP for spot rate.

Been through a similar process and it took ages, especially for them to credit the payment to our NI accounts, despite following all the steps. But seems to me like a bit of a no-brainer, as the payback is measured in months rather than years.

I submitted my form to pay Class 2 contributions at the beginning of August. I have phoned them twice and as of today it is still being processed. I'm not sure how long it will take to actually get an answer.

I have another 10 years to go. Though who knows how much it is worth by the time I receive pension payments.

From my view, the process is this:

You submit form CF83 (see https://www.gov.uk/government/public...ty-abroad-ni38 ) and that, at some point, generates a schedule of class 3 payments that you can make together with instructions on how to pay. It invites you to provide further information if, for any of those years, you wish to pay class 2 payments instead. Responding to that generates a second schedule including the "class 2" years you may be entitled to. You pay that and you get a confirmation that the payments have been assigned to the years according to the schedule.

Between each of those stages I had to make at least one call. Having made the call, something did usually happen with a few days.

Because I was close to retirement age at the time I submitted the original form, my case transferred from the HM Revenue & customs to the Department of Works and Pensions. That caused a significant delay at the start and that is when I learned that if you don't chase it up, your application can sit at the back of a queue.

I found it helpful to keep a systematic record of my phone conversations.

The 'active' part of the process (that is excluding the initial delay) was about 3 months.

From what I understand from the 2 schedules I received, the possibility of buying back contributions for 2017 and before disappears on the 05. April 2023. That may be personalised for me though.