8. How to work out if your pension will reach £164.35 through post 2016 qualifying years
To work out if you are likely to reach the full flat rate of £164.35 without paying voluntary contributions, you need to go through the following steps:
a) check your starting amount as at April 2016
b) add £4.70 per week for each year that you expect to work or be credited with contributions from 2016/17 onwards
c) if the total amount exceeds £164.35 then there is no point paying voluntary
The ‘Check your State Pension’ website contains some information that is relevant and may be helpful. It gives you two numbers – your starting amount and your ‘Personal Maximum’. Your ‘Personal Maximum’ is the most you can get in State Pension if all the gaps in your record were filled and all the years from 2016/17 counted towards your State Pension.
If your Personal Maximum is greater than or equal to the full flat rate of £164.35, it may be that you’ll get a full State Pension without needing to pay any voluntary contributions. This is especially likely to be the case if your starting amount is already close to the full flat rate and/or if you have a number of years to go between 2016/17 and when you reach State Pension age
If you have gaps in your National Insurance (NI) record you may be able to make up the gaps, and so increase your State Pension, by paying voluntary National Insurance contributions (NICs). However, you can’t fill a gap if, in the year in question, you were:
• over State Pension age at any point or
• eligible to pay the special reduced ‘married woman’s rate’ of National Insurance for that year, or
• exempt from paying NI as a self-employed person because you held a low earnings exception certificate. However, you may be able to pay voluntary Class 2 NICs – the special category of NI for the self-employed – and the cost of this is just £2.95 per week at 2018/19 rates.
Just thought I'd mention that the Class 2 NI contribution will be abolished in April 2019. It will be replaced by a new Class 4 contribution for
self employed contributors. I have not seen any mention of a replacement of the Class 2 contribution for those living abroad in any of the articles I have read.
I’ve just done this excercise for myself based on my own National Insurance record.
I’ve calculated that I need to pay £5000 to buy back my missing contributions but that this is worthwhile.
Just thought I'd mention that the Class 2 NI contribution will be abolished in April 2019.
My husband worked for a short period in the UK many years ago and about 15 years ago he started paying voluntary contributions and he qualified for a reduced pension when he reached pension age. All I can say it was a far better investment than what we paid into private pension schemes here - the only downside was that we didn't get tax relief on the contributions.
and it might disappear post-Brexit - who knows?
What might disappear? Voluntary contributions for non-British residents?
Who knows? anything could happen now
Overlapping periods (e.g. where paid contributions in the other country coincide with pre-entry credits in the Irish record, or Irish contributions for a posted worker are reckonable as periods of residence in the other country) are only counted once.
'where a decision is being made in relation to a pension entitlement, and overlapping contributions are examined to see which is the competent institution under the EU regulations at the time the contributions were made, i.e. which country would have been considered responsible for the person's social insurance liability at the time the contributions were paid.'
Overlapping periods are only counted once.
Wonder if you ever got an answer to this ..I am currently on process of buying12 years voluntary contribution d
I contacted the guy mentioned here Frank Buckley, and he is looking into my position, cant post the link but try google independent.ie uk pensions
There seems to be a certain amount of ambiguity on the internet about working in Ireland (thus paying compulsory PRSI contributions) and simultaneously paying UK voluntary NI contributions. I can't seem to locate a crystal clear answer on this.
We all know that HMRC accept our voluntary NI contributions if we're living and working and paying PRSI here in Ireland.
And bear in mind Ireland do not accept voluntary contributions if one is paying PRSI/NI in the UK or another EU state.
But I have a worry in the back of my mind that when the time comes for Ireland to pay out our dual-pensions, they're going to disregard any years in which we paid both compulsory PRSI and voluntary NI in the same year.
This little paragraph on welfare.ie has me slightly worried -
http://www.welfare.ie/en/Pages/Bilateral-Agreements---Guidelines-on-Application-of-Bilatera.aspx
On the surface that seems it only applies for pre-entry credits, but I still have some concerns about Ireland causing hassle over people paying into 2 social security schemes simultaneously.
I've also read elsewhere that someone received in writing that -
Case study -
-Joe was born in 2000 in England.
-Started working in 2020.
-He moved to Ireland in 2040, so with a record of 20 UK NI contributions.
-He worked in Ireland from 2040 until retirement age, likely at least 70 years old by that time, say 2070, and retiring with 30 PRSI contributions.
-Meanwhile, he paid UK voluntary contributions from the first day he moved to Ireland, until he accumulated the 35 years needed for a full UK state pension, so he topped up by 15 years from 2040 until 2055. (Remember he already had 20 years when he moved here). Which he is legally entitled to do.
-At retirement age, his portfolio is 35 UK contributions (enough for a full UK pension on it's own), and 30 Irish PRSI (enough for 30 out of 40 under the new Irish system that will begin soon).
-He believes he is entitled to a full UK state pension, plus entitled to a partial Irish pension of 30/40th's.
-He still lives in Ireland so applies for both pensions through the Pension department here.
Going back to that quote -
Now; do Ireland pay what he believes he is entitled to?
Or do they disregard all 'overlapping years' of contributions, which would result in him losing his 15 UK voluntary contributions, and thus Ireland pension department only working with 20/35th's UK contributions and 30/40th's Irish, giving a pro-rata amount, but no longer a full UK pension.
Sorry this was long winded. I'm not even that confident that a professional pension expert could give a clear answer.
So I'm going to see if the proof lies in the pudding here - is there actually anybody on this forum, or do any of you know a person who is currently claiming both the Ireland and the UK state pensions (whether it's both full pensions, both partial pensions, or a combination), due to Ireland taking into account overlapping years of voluntary NI contributions and compulsory Irish PRSI?
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