Need to fill National Insurance gaps to 2006? Now’s the time to act

If you’re nearing retirement, or simply planning your financial future, you need to be aware of the opportunity to fill National Insurance (NI) gaps dating back to 2006. With less than six months left before the deadline—April 5, 2025—it’s essential to understand what this may mean for you.

What Is the National Insurance gap?

The UK state pension is determined by your National Insurance record. To qualify for the full new State Pension, you need at least 35 years of contributions or credits. If you have between 10 and 35 years, you will still receive a proportionate amount. Gaps in your record occur when you haven’t paid or been credited with enough NI contributions for a particular year. This can happen for various reasons, such as unemployment, low earnings, or time spent living abroad.

For years, you’ve been able to fill these gaps by making voluntary NI contributions. Normally, you can go back up to six years. But, due to a temporary extension, you can fill gaps going all the way back to 2006—something that will no longer be possible after 5 April, 2025.

Why does this deadline matter?

The ability to fill gaps back to 2006 offers a unique opportunity to boost your state pension, if you’re short on qualifying years. After April 2025, the standard rule of only being able to top up the previous six years will apply again, meaning you’ll lose the chance to address any gaps arising before 2018.

This is particularly crucial if:

• You have gaps between 2006 and 2018 in your NI record
• You’re nearing retirement and want to maximise your pension
• You lived or worked abroad and missed out on making UK contributions during that time

Failing to address these gaps could mean losing out on thousands of pounds over the course of your retirement. Even just one missing year can reduce your state pension by as much as £275 per year!

How to check and fill gaps

1. Check your National Insurance record: You can do this online through your Government Gateway account or by contacting HMRC. This will show you how many qualifying years you currently have and identify any gaps.
   
   
2. Assess the cost: Voluntary Class 3 NI contributions are currently £17.45 per week (for the 2024-25 tax year), meaning it costs about £907 to fill one full year. However, this investment could significantly increase your state pension income for the rest of your life.
   
   
3. Decide how to fill the gaps: You may be able to fill some gaps through NI credits if you were caring for a family member, claiming benefits, or raising children. If not, you can make voluntary contributions.

Key points to consider

• Cost v benefit: The amount you’ll need to pay to fill a gap might seems steep, but the long-term benefit often outweighs the short-term cost. For example, filling just one year could boost your pension by £275 annually. Over a 20-year retirement, that’s an additional £5,500 for an upfront payment of around £900.
  
  
• Deadline approaching: Don’t wait until the last minute. As the deadline approaches, demand for HMRC services is expected to spike, which could result in processing delays.

Who should act?

This opportunity is most beneficial for people:

• Approaching retirement age (50s and early 60s)
• With incomplete years between 2006 and 2018
• Who lived or worked abroad during that time
• Who are self-employed or were employed part-time and didn’t pay enough contributions

With less than six months left until the deadline, now is the time to review your National Insurance record and take action to fill any gaps. Missing this window could mean missing out on a significant boost to your state pension!

Need help?

Get in touch with your usual Larking Gowen contact who can help to review your options. The deadline of 5 April, 2025, is fast approaching, and you don’t want to leave this until it’s too late! Find contact details in the Our People section of the our website. Alternatively, call 0330 024 0888 or email enquiry@larking-gowen.co.uk.