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Old 07.01.2021, 16:35
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Transferring National Insurance Contributions from the UK to Switzerland

Hello.

I have relocated from the United Kingdom to Switzerland.

I would like to know if anyone has had any experience with transferring their National Insurances contributions from the UK to their Second Pillar in Switzerland.

From what I have read, the UK Govt. agencies do not pay to abroad bank accounts. I am wondering if there is another way to make sure that those taxes do not get lost...

Thanks!
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  #2  
Old 07.01.2021, 16:40
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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Hello.

I have relocated from the United Kingdom to Switzerland.

I would like to know if anyone has had any experience with transferring their National Insurances contributions from the UK to their Second Pillar in Switzerland.

From what I have read, the UK Govt. agencies do not pay to abroad bank accounts. I am wondering if there is another way to make sure that those taxes do not get lost...

Thanks!
You have separate PILLAR 1 pensions from each country, worth paying UK voluntary class 2 contributions until you have 35 years, then you will get a full UK pension.

You can't take money from Pillar 1 & put it in Pillar 2.
Pension can be paid abroad without issue.
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Old 07.01.2021, 16:47
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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Hello.

I have relocated from the United Kingdom to Switzerland.

I would like to know if anyone has had any experience with transferring their National Insurances contributions from the UK to their Second Pillar in Switzerland.

From what I have read, the UK Govt. agencies do not pay to abroad bank accounts. I am wondering if there is another way to make sure that those taxes do not get lost...

Thanks!
Why don't you make Class 2 NIC contributions (very cheap), then collect your fat (considering how little you will have contributed) UK pension on top of your Swiss one.

It's only around the £200/year mark to get a full additional pension this way.
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Old 07.01.2021, 16:51
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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I have relocated from the United Kingdom to Switzerland.
NI is equal to Pillar 1.

As far as I understand you are not retiring. Wait until retire and then see what the laws and regulations are then. The current situation is explained here:
https://www.bsv.admin.ch/bsv/en/home...nt/brexit.html
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Old 07.01.2021, 16:53
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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You have separate PILLAR 1 pensions from each country, worth paying UK voluntary class 2 contributions until you have 35 years, then you will get a full UK pension.

You can't take money from Pillar 1 & put it in Pillar 2.
Pension can be paid abroad without issue.
sorry - didn't see your post until I posted!
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Old 07.01.2021, 20:28
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Re: Transferring National Insurance Contributions from the UK to Switzerland

I've been living here for years. Is there any benefit to me to buying some more UK NI contributions? Class anything?

I've looked into this before and don't really understand.
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Old 07.01.2021, 20:57
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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I've been living here for years. Is there any benefit to me to buying some more UK NI contributions? Class anything?

I've looked into this before and don't really understand.
How many years have you paid UK NIC (iirc you need at least 10). If you have that and are in employment here you can back pay 6 years. Each year counts as 1/35th or 1/40th (not sure if that changed recently) of a UK pension.

So - for example- you have 10 years in the UK and are now 50, you could back pay 6 years plus every year going forward to age 67. So 10 + 6 + 17 =33 years, nearly a full UK pension.
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Old 07.01.2021, 21:01
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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I've been living here for years. Is there any benefit to me to buying some more UK NI contributions? Class anything?

I've looked into this before and don't really understand.
Yes, as much as possible, assuming you left the UK & became an employee Class 2 is very very cheap. I paid Class 3 at 3 times the price for over 10 years & then stopped as I had 30 years, which was the 'new' reduced max required. Max pension years increased to 35 years (40 years when I left the UK) & could buy the extra 5 years as class 2.
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Old 07.01.2021, 21:07
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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I've been living here for years. Is there any benefit to me to buying some more UK NI contributions? Class anything?

I've looked into this before and don't really understand.
Yes! Do it, and do it now!
You only need to pay class 2, but in any case you need to get to 35 years for the full UK pension, pro rata if less than that.
Logon to the UK govt. gateway, and look at your paid up years.

Phone them to set up a direct debit from now going forwards, from beginning of the 2021 tax year is perfect.
Then ask them to send you a statement of the missing years you can buy back at class 2.
When that arrives, pay it pronto.
Up to 2023, you can pay back 'many' years (due to the change to the 'new state pension'), after 2023 it reduces to the previous 5 or 6 years only.
You are working here, so you do not need to pay class 3. The gateway only shows class 3 buy back option, which is why you need to phone them.

It's very likely Rishi will be overhauling the NI this parliament, and will abolish class 2, so the time is ripe to catch up.
Also one day, you may end up back in the UK. Never say never.
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Old 07.01.2021, 21:21
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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How many years have you paid UK NIC (iirc you need at least 10). If you have that and are in employment here you can back pay 6 years. Each year counts as 1/35th or 1/40th (not sure if that changed recently) of a UK pension.

So - for example- you have 10 years in the UK and are now 50, you could back pay 6 years plus every year going forward to age 67. So 10 + 6 + 17 =33 years, nearly a full UK pension.
Are you sure 10 years is correct to be able to make class 2 contributions.

I have 9 years at present and would dearly like to know. If I pay one year class 3 could I then move onto class 2?

Edit: Found the following quote:

"Individuals who have been resident in the UK for at least three years, and paid into the national insurance system, can continue to make NI contributions by paying class 2 NIC when they move abroad."

I presume I can just pay class 2 nic

Last edited by HickvonFrick; 07.01.2021 at 21:36.
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  #11  
Old 07.01.2021, 21:35
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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Are you sure 10 is correct?

I have 9 and would dearly like to know. If I pay one year class 3 could I then move onto class 2?
It's the number of years, not the class, that counts.
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Old 07.01.2021, 21:37
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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It's the number of years, not the class, that counts.
So can I make additional contributions?
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Old 07.01.2021, 21:55
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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So can I make additional contributions?
Yes. Pay class 2, because you are working here.
Call them. Number is on the gov website.
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Old 07.01.2021, 23:07
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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How many years have you paid UK NIC (iirc you need at least 10). If you have that and are in employment here you can back pay 6 years. Each year counts as 1/35th or 1/40th (not sure if that changed recently) of a UK pension.

So - for example- you have 10 years in the UK and are now 50, you could back pay 6 years plus every year going forward to age 67. So 10 + 6 + 17 =33 years, nearly a full UK pension.
So in my case, I moved to Switzerland at 29. I‘ve just checked the government gateway and I have 10 full years‘ contributions thanks to working part-time during college and uni. In theory then I could buy 6 years backwards and pay in the future until I have the full 35 years (by 57 years old). According to the OASI website, due to the level of my contributions to date, if I continue to contribute I will get a full Swiss pension.

Are we saying that if I pay my 6 years back (6 x 52 x £3.05) and pay £160 a year (or whatever the rate is in the future), I will be entitled to both a full Swiss and UK state pension? That sounds crazy!
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Old 07.01.2021, 23:42
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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So in my case, I moved to Switzerland at 29. I‘ve just checked the government gateway and I have 10 full years‘ contributions thanks to working part-time during college and uni. In theory then I could buy 6 years backwards and pay in the future until I have the full 35 years (by 57 years old). According to the OASI website, due to the level of my contributions to date, if I continue to contribute I will get a full Swiss pension.

Are we saying that if I pay my 6 years back (6 x 52 x £3.05) and pay £160 a year (or whatever the rate is in the future), I will be entitled to both a full Swiss and UK state pension? That sounds crazy!
A few years ago, I back paid 6 years of class 2 and have been paying class 2 NICs since. I'll be on track to get a full UK pension in a few years. It's nothing to get too excited about since:

1. The UK state pension isn't that huge when you consider Swiss living costs and depreciation in GBP; and
2. By the time I retire, I may not actually receive anything. The biggest risk I see is means-testing of the state pension. However, I still pay into it as a kind of insurance policy i.e., if I lose everything else, then I will qualify even with means-testing and it will have to be the fallback position
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Old 08.01.2021, 04:12
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Re: Transferring National Insurance Contributions from the UK to Switzerland

I think I'd seek to manufacture failing the means test (Passing home to child etc. not lying). I doubt I'd have any substantial income outside of pillar 1 in any case so might fail it anyway if they didn't include wealth. I intend to be almost entirely living off capital gains. I won't be participating in pillar 2 to any significant extent.

I'd also be pretty unlikely to stay here on retirement - would want somewhere warmer, cheaper and more English speaking.

Last edited by HickvonFrick; 08.01.2021 at 04:40.
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Old 08.01.2021, 09:59
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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A few years ago, I back paid 6 years of class 2 and have been paying class 2 NICs since. I'll be on track to get a full UK pension in a few years. It's nothing to get too excited about since:

1. The UK state pension isn't that huge when you consider Swiss living costs and depreciation in GBP; and
2. By the time I retire, I may not actually receive anything. The biggest risk I see is means-testing of the state pension. However, I still pay into it as a kind of insurance policy i.e., if I lose everything else, then I will qualify even with means-testing and it will have to be the fallback position
Max Swiss state pension in currently c. CHF 28k. UK at GBP 9k currently = CHF 11k, so nearly a 40% uplift. As a starting point CHF 78k for an unmarried couple‘s retirement income doesn‘t sound too shabby. Plus pillar 2, pillar 3 and our own investments. As things stand, I do not see us retiring in Switzerland (nor the UK), so any further GBP depreciation, I would expect to be offset by CHF appreciation.

Agree that means testing is a risk, but would also add that I don‘t see the state retirement age being below 70 by the time we are able to claim. Nevertheless, if we treat our NI contributions to date as sunk costs, then paying £1k now and another £3k in the future to have the safety net you mention and potentially £9k pa from retirement to death seems an incredibly good risk to take.

I had assumed and am amazed that there isn‘t something like a reverse double-taxation treaty for social security to prevent double-bubble, but if there isn‘t, it‘s a no-brainer.
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Old 08.01.2021, 10:04
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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Are we saying that if I pay my 6 years back (6 x 52 x £3.05) and pay £160 a year (or whatever the rate is in the future), I will be entitled to both a full Swiss and UK state pension? That sounds crazy!
I think what you are trying to ask, the answer is yes. You will get 2 seperate state pensions. But full...

The Swiss state pension I think is something like 42 +/- years to contribute. Its also a bit more complex in terms of how much you earned to what is paid out, its not fixed like the UK, so in rough terms you would get perhaps 35 or 36/42nds of a full Swiss pension if you stayed here until retirement (full being 2,300 CHF a month currently)

For UK you should have paid since 16, moved here at 29 so about 13 years worth of payments, back pay 6, you'll have currently about 19/35ths of a full UK pension - today. (I think the full UK state pension is about 170 quid a week)
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Old 08.01.2021, 10:33
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Re: Transferring National Insurance Contributions from the UK to Switzerland

I left the UK in 1994. A few years ago, thanks to this forum and Richdog (who I think might still be around under another name), I discovered that I could pay Class 2 NI contributions going back 10 years and going forward. I am now entitled to a full UK pension and my Swiss/Italian husband has one more year to pay to get his full entitlement too (he worked in the UK for a number of years). The whole thing cost around 2000 pounds each. At our age (61 and 59) we are likely to see some benefit from our small investment. The way I look at is that for the price of a pretty decent bottle of wine in a restaurant per year, we have secured enough income to likely cover a large part of our health insurance here which is a fairly large cost for a retired person particularly as we wish to maintain our current level of cover. Obviously the younger you are, the higher the risk, but it seems well worth taking to me.
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Old 08.01.2021, 11:21
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Re: Transferring National Insurance Contributions from the UK to Switzerland

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For UK you should have paid since 16, moved here at 29 so about 13 years worth of payments, back pay 6, you'll have currently about 19/35ths of a full UK pension - today. (I think the full UK state pension is about 170 quid a week)
UK gives a free contribution from age 16 whilst in full time education & also for mothers of young children. UK pension is an amazing deal, you still get a UK personal allowance so could be taxable in the UK, yet tax free.
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