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Old 21.02.2014, 12:46
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UK voluntary National Insurance contributions and state pension

Hello

I phoned the authorities in the UK yesterday to get the latest information about minimum requirements for a state pension and when you need to pay NI voluntary contributions.

If anyone wants more info, let me know and I'll post what they told me.
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Old 21.02.2014, 13:39
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Re: UK voluntary National Insurance contributions and state pension

Why? Is it a secret?

(I think it'd be interesting to know - I know a couple of people that make some sort of voluntary contribution to keep their "stamp" going.)
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Old 21.02.2014, 13:41
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Re: UK voluntary National Insurance contributions and state pension

If you are paying Swiss AHV you do not need to pay UK NI nor is there any purpose in doing so. The Swiss pension benefit is far far superior.
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Old 21.02.2014, 14:29
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Re: UK voluntary National Insurance contributions and state pension

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Why? Is it a secret?

(I think it'd be interesting to know - I know a couple of people that make some sort of voluntary contribution to keep their "stamp" going.)
Nope, just gauging the interest. No point typing it out for no reason
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Old 21.02.2014, 14:41
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Re: UK voluntary National Insurance contributions and state pension

Get typing!
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Old 21.02.2014, 14:43
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Re: UK voluntary National Insurance contributions and state pension

https://www.gov.uk/voluntary-nationa...-contributions

https://www.gov.uk/state-pension/eligibility
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Old 21.02.2014, 14:43
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Re: UK voluntary National Insurance contributions and state pension

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Nope, just gauging the interest. No point typing it out for no reason
Well, it probably affects a good % of members of this forum so typing it out once for all to read and discuss/contribute is probably better than answering a deluge of PMs with the same message...
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Old 21.02.2014, 14:55
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Re: UK voluntary National Insurance contributions and state pension

Ok, the key points I picked up are these:

- the minimum number of 'qualifying' years you need to pay to get a full UK pension is currently 30. The legislation is being reviewed and this is expected to go up to 35 soon. You can find out how many qualifying years you have by sending off for a statement (details of how to do that are here: https://www.gov.uk/voluntary-nationa...-contributions)
- there is no current minimum number of qualifying years to get any state pension at all - it is calculated from contributions. This is also being reviewed and likely to go up to 5 or 6 years soon (i.e. if you have less than 5 or 6 qualifying years you will get nothing)
- if you want to increase your number of qualifying years, you can either pay class 2 voluntary contributions if you are working abroad and paying into the local social security system (I presume only for countries with an agreement, but this needs checking for outside EEA - Switzerland is fine anyway) or class 3 contributions if not paying into local social security system. Class 3 contributions are higher than Class 2. I think the amounts are detailed on the website above

When it comes to retirement age, the UK authorities (allegedly) coordinate with the foreign authorities and they come to some agreement about what will be paid to you. The person I spoke to couldn't give me any more specific info about that, but mentioned that it is important to understand the minimum contributions in countries you've worked in abroad so that there will be something available from those countries.

All this is in the spirit of sharing, so the usual disclaimers apply ...
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Old 21.02.2014, 14:57
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Re: UK voluntary National Insurance contributions and state pension

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Well, it probably affects a good % of members of this forum so typing it out once for all to read and discuss/contribute is probably better than answering a deluge of PMs with the same message...
Done - but, just wanted to reiterate it really depends on individual circumstances. @baboon's comment above may well apply to most.
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Old 21.02.2014, 15:05
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Re: UK voluntary National Insurance contributions and state pension

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If you are paying Swiss AHV you do not need to pay UK NI nor is there any purpose in doing so. The Swiss pension benefit is far far superior.
Why is this? What about if you have, say, 15 or 20 years NI contributions now and will have, say, 20 years AHV contributions at retirement? Is it not worth topping up the NI contributions now to maximise your pension [assuming the rules don't change between now and then, which is obviously a strong possibility]
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Old 21.02.2014, 15:10
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Re: UK voluntary National Insurance contributions and state pension

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If you are paying Swiss AHV you do not need to pay UK NI nor is there any purpose in doing so. The Swiss pension benefit is far far superior.
But there are us trailing spouses who are not working in Switzerland but worked in the UK.
I have been in touch with the authorities recently and thankfully have enough qualifying years under my belt.
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Old 21.02.2014, 15:13
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Re: UK voluntary National Insurance contributions and state pension

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Why is this? What about if you have, say, 15 or 20 years NI contributions now and will have, say, 20 years AHV contributions at retirement? Is it not worth topping up the NI contributions now to maximise your pension [assuming the rules don't change between now and then, which is obviously a strong possibility]
This is pretty much my situation and as far as I can tell the £500* GBP per year top up over ten years seems like a small price to pay for a "second" state pension.

I just wonder whether the UK could limit or even refuse you the pension if the Swiss one is over a certain threshold (defined already or at some point in the future).

* I believe it was something around this figure last I checked.

Last edited by fingerscrossed; 21.02.2014 at 15:52.
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Old 21.02.2014, 15:31
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Re: UK voluntary National Insurance contributions and state pension

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When it comes to retirement age, the UK authorities (allegedly) coordinate with the foreign authorities and they come to some agreement about what will be paid to you. The person I spoke to couldn't give me any more specific info about that, but mentioned that it is important to understand the minimum contributions in countries you've worked in abroad so that there will be something available from those countries.
Incidentally, it would be great to hear from anyone who has any experience of this part, it sounds a bit too good to be true.
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Old 21.02.2014, 15:32
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Re: UK voluntary National Insurance contributions and state pension

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- there is no current minimum number of qualifying years to get any state pension at all - it is calculated from contributions. This is also being reviewed and likely to go up to 5 or 6 years soon (i.e. if you have less than 5 or 6 qualifying years you will get nothing)
That seems a bit harsh - at least within the EU they should "transfer" the pension years between the respective national systems, no?
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Old 21.02.2014, 15:37
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Re: UK voluntary National Insurance contributions and state pension

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That seems a bit harsh - at least within the EU they should "transfer" the pension years between the respective national systems, no?
My understanding is (for example): if you retire in the UK after contributing in Switzerland for 6 years and the Swiss minimum is 5 years, this will be transferred to the UK. If (depending on the impending change) you also contributed in the UK for 4 years and the minimum is 5 years, you will get nothing from the UK.
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Old 21.02.2014, 15:42
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Re: UK voluntary National Insurance contributions and state pension

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My understanding is (for example): if you retire in the UK after contributing in Switzerland for 6 years and the Swiss minimum is 5 years, this will be transferred to the UK. If (depending on the impending change) you also contributed in the UK for 4 years and the minimum is 5 years, you will get nothing from the UK.
When I last looked into this some years ago, I was told that if I keep contributing in the UK, I will receive a UK state pension in addition to and irrespective of whatever pension I receive in Switzerland. I had already made about ten years of contributions out of the 30 required.

Therefore I am continuing to contribute in the UK too.
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Old 21.02.2014, 15:48
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Re: UK voluntary National Insurance contributions and state pension

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When I last looked into this some years ago, I was told that if I keep topping up in the UK, I will receive a UK state pension in addition to and irrespective of whatever pension I receive in Switzerland.

Therefore I am topping up.
this is my understanding too, if you are currently working out here then the class 2 contributions, which is the ones you need, are GPB2.50 a week, which is so low somebody somewhere should be shot for it, but for expats like ourselves you should be jumping at the chance. to boot, you can backpay up to 5 years. therefore if you havent been doing this, you can backpay 5 years at around 125 quid a year and when you retire, if your in blighty you'll get your state pension and your swiss pension from contributions here and if your here, you'll get your uk pension and your swiss pension. i.e. you can't lose.............. except if they change the state pension to be means tested by the time we retire and decide that anyone who has actually worked for a living therefore "has broad shoulders and must bear a greater share of the load" (the famous line that is wheeled out when taxing hard working people) and decide that if you have a private pension then your ok jack and dont qualify for a state one.

but at 125 quid a year, its a gamble worth taking.
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Old 21.02.2014, 16:36
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Re: UK voluntary National Insurance contributions and state pension

Ok, to say I know someone who worked in the UK for X amount of years. (approx 20 years, give or take the odd years).

They then left UK.
Around the time they reached UK retirement age, they contacted whoever with the relevant UK department; and were advised if they paid £X amount in the thousands, they would then be receive 2/3rd of the UK pension.

That is what they did and they now receive the 2/3 approximately of the UK State Pension.

At time of writing this, they have not yet reached retirement age in their own European country, but expect to recieve something pro-rata from their country when they retire.

Separately the UK State pension age is changing depending what year/month you were born. No idea what in the future it will end up to be for those new..ish in the system. Rumours one day could be 75, as life expectancy improves.
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Old 21.02.2014, 16:45
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Re: UK voluntary National Insurance contributions and state pension

I just left a very similar post.

I would say pay both. Well Swiss while working here you cant avoid. I think its Cat 2 (could be cat 3) UK contributions are 130 quid a year. This is what you should be paying, they wont tell you this and must go through the paper work and apply, but this is what you should be paying...its peanuts!

Both pensions will (as it stands) pay out separetly. lets say you retire in Swiss. The swiss will manage your uk state pension but you will still recieve, for example you 115 quid a week UK and your 2,300 CHF a month Swiss.
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Old 21.02.2014, 20:43
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Re: UK voluntary National Insurance contributions and state pension

When I left the UK I had around 20 years contribution to the UK State Pension and as I wasn't working in CH, I have paid my contribution each year, and now being back at work I have continued as it will give me the UK full state pension (once I get 30 years) plus any Swiss one I have built up. For the cost, I think it is worth it - even little helps as they say. But I won't rely just on that - as it might be worth about £3.50 by the time I retire!
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