NIC gaps

The PTA allows taxpayers (not their agents), to check their National Insurance Contribution record for their entire working life. This is very useful service, as it can highlight where gaps in the record exist that the taxpayer may not be aware of.

If the client can’t access their PTA online, they can request an NI statement by phone: 0300 200 3500, or we as their agent can submit an online request for an NI statement on their behalf.

Due to the long running problems with class 2 NI (see our newsletters: 9 November 2017, 1 March 2018, 16 August 2018, 1 August 2019) in a number of cases HMRC stopped collecting the class 2 NIC. The taxpayer may not have noticed that the small amount of class 2 NIC was not being collected.

If the NI statement or the PTA shows there are years with insufficient contributions, there are ways of making up the short-fall, but it does depend on when it occurred. It’s important to make up the gaps so the taxpayer can receive the full state pension.

Men born after 5 April 1951 and women born after 5 April 1953 can pay class 3 NIC to make up gaps in the years 2006 to 2016. Other retirees have six full calendar years from the date they reach state pension age to pay additional voluntary contributions. Individuals of working age can only pay voluntary contributions for the last six tax years.

We can also check if our client would have been entitled to NI credits, but for some reason those credits were not added to their NI record. NI credits should be given automatically when Jobseekers allowance, universal credit and a number of other state benefits are claimed. However, in some cases the NI credit has to be claimed as it is not given automatically.

Written by the Tax Advice Network