State pension warning over national insurance loophole that could see you miss out on cash in retirement | The Sun

MILLIONS of women could be missing out on state pension cash due to a loophole – but there is a way to claim the money back.

A 66-year-old woman was told she would miss out on National Insurance (NI) credits towards her pension.

You can get NI credits towards your state pension if you are on child benefit, but the woman missed out because her husband was the one receiving it, Reddit user TheEggyBreadMonster explained.

You receive child benefits if your child is under 12.

And as long as the child benefit is in your name for the full year you get a full year towards your state pension – but if not, this simple mistake could mean you miss out on cash in retirement.

Steve Webb, a former pensions minister and now partner at LCP, said he came across issues like this "quite often".

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"Sometimes a husband has dealt with all the paperwork, or perhaps felt he was doing the new mother a favour by filling in the child benefit forms when the baby was first born."

However, the good news, is that you can claim to have the NI credits transferred from your husband's name and into yours.

This applies to people who have reached pension age after 2008.

To claim the credits back, you simply have to fill in a CF411 form and send it to HMRC.

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They will check the records and should do the transfer, and then your state pension can be recalculated.

You need to make enough NI contributions in order to qualify for state pension payments. 

People in Britain need at least 10 qualifying years on their NI record to receive a proportion of state pension, and 35 years to claim the full amount.

But many women find themselves in a situation where they don't qualify because they take time out of a career break or maternity leave.

The Sun previously reported one case where a woman checked her state pension forecast to discover only two out of a possible nine years qualified towards her state pension.

Solape Alatise was one of four million people who missed out on a state pension qualifying year in the tax year 2018-19, according to government figures.

But this isn't the only payment many nearing state pension age could potentially miss out.

Just this week, money saving expert Martin Lewis urged everyone 66 or over to check whether they are eligible for extra help worth £3,300 a year.

Many retired people don't realise they could be in line for the extra help to boost their pension.

Who is eligible for National Insurance Credits?

You can get National Insurance credits if the following applies:

  • You’re on Jobseeker’s Allowance and not in education or working 16 hours or more a week or you’re unemployed and looking for work, but not on Jobseeker’s Allowance
  • You're ill, disabled or on sick pay
  • You're on maternity, paternity or adoption pay
  • You're a parent who has registered for child benefit for a kid under 12, you want to transfer credits from a spouse or you're a foster carer
  • You're a carer on carer's allowance, on Income Support and providing regular and substantial care or you're caring for one or more sick or disabled person for at least 20 hours a week
  • You’re a family member over 16 but under State Pension age and you’re caring for a child under 12 
  • You're on working tax credit or universal credit
  • You're on a training course or jury service
  • Your partner is in the armed forces
  • You've been wrongly imprisoned

How can I check if I've missed any National Insurance contributiuons?

You can see how many years of NI payments you've made and check any missing years on the government website.

You'll need to create a government gateway account online to be able to check this though.

You can also request a statement online, over the phone or by post, but writing to: National Insurance contributions and Employers Office, HM Revenue and Customs, BX9 1AN,

The closer you get to retirement, the more important it is to check how many years you have.

How can I claim National Insurance credits for gaps?

You can check the full list of who's eligible for claiming credits on the government website.

It explains the circumstances where you'll need to claim and when you'll get it automatically.

You'll either need to apply online or have to contact your local Job Centre to receive the credits.

You can do this again by checking out the government's website.

If you are not entitled to NI credits for a year, you can also pay to fill in the gaps by making voluntary contributions,

You can do this before state pension age and once you reach it.

Most people will do this by buying what's known as class 3 national insurance credits to fill gaps in their record at a cost of £15.85 a week for the 2022/23 financial year.

So to get a whole year's worth, and you'd pay £824.20.

This could boost your state pension by over £200 each year.

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But one important thing to note, is that you can usually only pay for gaps in your NI record from the past six years.

The rules on how much you pay are also slightly different if you're self-employed and buying class 2 contributions.

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