Personal Finance

Pensions doctor: 'Have I paid enough in National Insurance to get the full state pension?' 


Write to Kate with your pension problem: Columns are published twice a month on Tuesday mornings

Dear Kate,

My state pension retirement age is 66 on 8 July 2022. If I do not continue to work and therefore pay no National Insurance Contributions up until this date does it mean I will not be entitled to the higher rate of pension than if I do continue? 

Many thanks for your help,


This is definitely an important consideration to take into account when planning for your retirement. As you will reach your state pension age in two years’ time, it’s critical that you understand how much you will receive and if there’s anything you can do to increase your state pension.

The first point to note is that state pension system was revamped on 6 April 2016.  Whether you receive a state pension under the old or new rules depends on when you were born and consequently when you reach state pension age (SPA). As you will reach your SPA of 66 in July 2022, you will receive the new state pension.  

The full new state pension is currently £175.20 per week, but to get this you need to have built up 35 qualifying years by paying National Insurance contributions (NICs) or NI credits over your working lifetime. 

NICs are typically paid when you are working, whether you’re employed or self-employed, but you can also build up NI credits for time spent out of the workplace, for example if you are claiming state benefits due to illness, disability or unemployment or if you’re a carer.

If you have at least 10 but less than 35 years qualifying years of NICs or NI credits you’re eligible to receive a reduced new state pension. For example, if you have 30 qualifying years of NICs, your state pension is calculated as 30/35 of the full new state pension. This would give you a state pension of £150.17 a week. 

Your qualifying years don’t need to be consecutive and having more than 35 years qualifying years of NICs or NI credits will not increase your state pension. 

Your new state pension may be affected by complex transitional rules, designed to make sure no-one loses out by getting less under the new state pension than they were entitled to under the old state pension rules. Everyone with an NIC record as at 6 April 2016 is given a one-off starting amount, where the old state pension rules are compared to the new rules and you’re entitled to the higher amount. 

Ask Kate a question | The Telegraph’s pensions doctor

If you were contracted-out of the earnings-related additional state pension under the old rules, this will have been taken into account when calculating your starting amount. 

You should be aware that if your starting amount was less than the full new state pension in 2016-17 (£155.65 per week) any new qualifying years added between 6 April 2016 and your SPA will increase your state pension up to the full amount.

But if your starting amount was more than the full new state pension, any new qualifying years made after 5 April 2016 won’t increase your state pension. 

Finally, if your starting amount is above the full new state pension, the difference, known as a protected payment, will be paid on top of your new state pension when you reach your SPA. 

You can find out how much state pension you have by going to the Government website to request a forecast.  You may have some gaps in your NIC record so it’s worth checking your NI record. 

If you do have gaps, you may be able to increase your state pension by claiming for NI credits or paying voluntary NICs, which are often referred to as "Class 3".    

A word of warning, paying voluntary NICs may not increase your state pension. So, it’s worth contacting the Future Pension Centre before making any voluntary payments.

Generally, people can only pay for NIC gaps for the past six years. But it is possible to make up gaps from more than six years ago depending on your age.  For example, men born after 5 April 1951 and women born after 5 April 1953 have until 5 April 2023 to pay voluntary contributions to make up any NIC gaps between April 2006 and April 2016. Voluntary NICs can be paid even after you reach SPA.

Another way to increase your state pension is to defer claiming it by at least nine weeks from your 66th birthday. If you do this, your state pension is increased by 1pc for every 9 weeks, which works out as an increase of just under 5.8pc if you delay payment by 52 weeks. In my example above based on 30 qualifying years, the state pension of £150.17 a week would increase by £8.71 a week to £158.87. 

Finally, don’t forget to check how much you’ve saved into your workplace and private pensions. This might affect your decision on whether to plug any NI gaps, or defer your pension, as the state pension, just like any other income is taxable.  


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