National Insurance Contributions

Dont pay it yet, things are changing there maybe a flat rate pension regardless of the number of contributions made.

I had the same letter and decided to leave it given the potential changes.

Times have changed . They used to demand payment , now they invite you to pay . Just up the ante on here, it covers Nic, Pc........ everything !

noodles

really depends how long you have to go to 65

I was given this option when I was 53 (I owed £220) - decided to pay it, but if I was under 40, I wouldn't

I pay them. For all it costs, better safe than sorry.

Thanks for replies. Im 40 ( )

Voluntary (class 3) NIC's are a rip off of the gullible.

Register as self employed (anyone can do that) and pay class 2 NIC's at £2.40 per week, rather than the £12.05 per week volantary rate. That's quite a difference when paid quarterly.

To register as self employed just phone your local tax office or go in and pick up a form, it's simple.

I think you can back-pay up to 5 years ago, so you don't need to decide whether or not to pay yet.

What a huge mistake it was for the government to announce its review of NI contributions.  What idiots will voluntarily pay now?

I've ceased the optional payment tbh and just receive the once a year letter now reminding me , same with the taxman really in that I told him 3 years ago I had no intention of working for anyone and that I would be living off what I already have but was happy to let them access my bank a/c any time they liked , not heard from them since.

Each missing year costs £626.60

And buys you a pension of £3.25 a week

So long as you live for more than 4 years - it's a good deal.

Let's not forget class 1 and class 4 contributions though, which we pay all our working lives at around 10% added on to our income tax, which makes the basic rate of tax around 30%, not 20%.

You sound as if you're, or used to be at least, a tax accountant Trevh ?

No fafh, just have always been self employed since I left school, so had to learn basic stuff for doing the tax return.

Why would you register as self employed?  Surely this is opening yourself up for an awkward and unnecessary visit from the Taxman?

I had 3 years to go when I first received the letter asking me to top up my NI contributions. For each of the last 3 years I have paid it, and now I am OK. I think that if you can afford it, you should pay it.  Otherwise, you could end up in poverty, once you have reached retirement age.