If you want to find out your state pension age and your state pension forecast, it’s really quite straightforward these days.
You used to have to write a letter or phone HMRC and they would – eventually – post it out to you. But now, you can do it online through your Government Gateway accounts.
So, the first thing you need to do is log in here
When you’re in, just scroll down to the section headed “Pensions” – probably right at the bottom of the page. If you can’t see a pension section, you might have logged in as your business rather than as you personally, so just check you can see your name (and not e.g. Joe Bloggs Limited) at the top.
There’s two things you want to be looking out for – your Pension Forecast and your National Insurance record.
Pension Forecast
If you click FORECAST, this will tell you WHEN you’ll get your state pension. For me, it’ll be August 2053. This section also tells me how much it’ll be, if I don’t make any more NI contributions, and how many more years I need to contribute to get the full amount.
Please print a copy of this page and send it to us for our records. This way, we can make sure you’re on target for the full pension and – if not – what we can do to make up time!
National Insurance Record
Next, you want to look at your National Insurance record. This tells you how many years’ contributions you have, and you can see all of the previous years – and whether there’s any gaps.
As with the Forecast, you can print or save the page for your records, and for us too.
Obviously for the current year, HMRC won’t have enough information to determine whether you’ve contributed. Don’t worry – it normally takes about six months after the year-end for HMRC to get its act together.
But if you’ve got a whole load of gaps in your record, and less qualifying years on your Forecast than you were expecting, this might help to work out where it’s gone wrong.
Depending on your age, you’ll need between 25 and 35 qualifying years to get the full state pension. BROADLY a qualifying year is one where you have paid either Class 1 or Class 2 National Insurance, although there are some other exemptions and ways to get credit even if you’re not working.
How can Accountants help?
Ignoring gaps in your state pension is dangerous – as time goes on, it gets harder to fill those gaps retrospectively. And each year you’re on this earth without getting a qualifying year is going to result in a pension shortfall of about £300 per year.
If you enjoy 25 years of retirement, that’s £7,500 you’ve missed out on for EACH year you didn’t fill up the pot.
And here’s the most frustrating part – often, it costs NOTHING in tax to get those extra years. So, please, speak to us ASAP if this is something you’re worried about.
Email peter@blue-penguin.co.uk for more details.
