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Deadline to plug National Insurance Contributions gap extended to April 2025

Samantha Partington
Written By:
Posted:
12/06/2023
Updated:
12/06/2023

The Government has extended the deadline to plug National Insurance Contributions (NICs) gaps until April 2025, a move it says will help thousands more households to boost their state pension.

The extension gives taxpayers more breathing space to afford and submit back payments of National Insurance Contributions (NIC) unpaid between the April 2006/07 and the April 2016/17 tax years.

Under the Government’s standard rules, households can only fill in gaps in their National Insurance records for the previous six years, with a deadline of 5 April each year.

But as part of the transitional arrangements to the new state pension in 2016, taxpayers were given a special 10-year window extending their opportunity to plug gaps to increase the amount of state pension they receive in retirement.

Under the new state pension rules, affecting those who retire on or after 6 April 2016, retirees need at least 10 years of NICs to qualify for a state pension, and 35 qualifying years to receive the full amount (currently £203.85 a week).

Those with less than 10 years of contributions will not receive any state pension at all.

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The deadline for making additional payments was originally 5 April 2023 but this was extended to 31 July after HMRC and the Department for Work and Pensions said they had experienced a surge in customers contacting them to make use of the special 10-year rule ahead of the deadline.

But now, it has confirmed people have until 5 April 2025 to fill gaps in their record dating back from April 2006 to 2016/17.

The Government confirmed all relevant voluntary NICs payments will be accepted at the rates applicable in 2022/23 until 5 April 2025 (£15.85 a week or £824.20 a year).

‘Paying voluntary NICs a great deal’

Alice Haine, personal finance analyst at investment platform Bestinvest, said: “The Government’s decision to extend the deadline is no surprise when you consider the long delays in the system. One taxpayer reported checking the status of their application to make up a shortfall to be told the system was still processing requests from August 2022.

“The extension not only gives the Government time to catch up on the volume of enquiries, but also allows more taxpayers to find out if they would benefit from making up any missing years. The extra time will also give those that will gain from making up a shortfall the chance to build up funds to cover the cost, which can run into the thousands depending on how many missing years they have on their record.”

Andrew Tully, technical director at Canada Life, said: “Paying voluntary NICs to boost your state pension can be a great deal, and you should get your money back after around three years. But care needs to be taken as many people will have sufficient NICs to qualify for a full state pension, so have no need to pay more.

“Even if you have gaps in your record you may be able to fill these for free by making sure you have received credits, for example, if you were unemployed, or caring for relatives. You can get a state pension forecast from gov.uk which will show if you are on track and highlight any gaps in your NI record.”

Laura Trott, minister for pensions, department for work and pensions, said: “I am pleased to see so many people taking steps to review their State Pension, which is why we have extended the deadline for customers to add extra years to their National Insurance record.

“This extension means thousands more people will have time to check their entitlement, and in many cases increase the amount they receive when they retire.”

You can check your National Insurance record here, as well as via the HMRC app or the Personal Tax Account. You can get a State Pension forecast here and decide if making a voluntary National Insurance contribution is worthwhile.