The deadline for voluntary National Insurance Contributions from April 2006 up to April 2017 was originally set at the 5th of April 2023. However, in March 2024, HMRC announced an extension to the deadline ...
The extended deadline for voluntary NIC is a welcome update!
This means that taxpayers have until the 5th of April 2025 to fill gaps in their NIC record. This extension is a result of the COVID-19 pandemic and the cost of living crisis and the impact on taxpayers' ability to make voluntary contributions.
It is estimated that tens of thousands of taxpayers will benefit from this extended deadline, giving them more time to fill gaps in their NIC record and increase their entitlement to state pension and other benefits.
"So, what does this extended deadline mean for taxpayers?"
Firstly, it is important to understand the purpose of voluntary NIC. These contributions are made by individuals who have not paid enough NIC to qualify for the full state pension. By making voluntary contributions, they can fill gaps in their NIC record and increase their entitlement to state pension and other benefits.
The extended deadline gives taxpayers more time to make voluntary contributions for the tax years between April 2006 and April 2017. This means that those who were unable to make contributions during this period now have an opportunity to do so and improve their NIC record.
It is worth noting that the extended deadline only applies to voluntary contributions for the tax years between April 2006 and April 2017. There are ways to make voluntary NIC contributions for tax years after then, but you should speak to your accountant first.
The extension also applies to Class 3 voluntary contributions, which are paid by those who are not employed or self-employed. These contributions can also help fill gaps in NIC records and increase entitlement to state pension and other benefits.
However, taxpayers should also be aware of the potential impact on their tax liability as making voluntary NIC contributions can affect their tax position, particularly if they are close to reaching the annual threshold for National Insurance contributions.
And remember, the extended deadline does not apply to all taxpayers. Those who have already reached state pension age or are due to reach it before the 5th of April 2025 are not eligible to make voluntary contributions.
"The extended deadline for voluntary NIC is a welcome update!"
But as always, carefully consider any individual circumstances before making voluntary contributions. This should include seeking advice from an accountant or tax adviser to determine if it is the right decision.
Until next time ...
ROGER EDDOWES Business Godparent
Would you like to know more?
If anything I've written in this blog post resonates with you and you'd like to discover more about voluntary NIC and whether you need to or should pay it, it may be a great idea to call me on 01908 774320 and let's see how I can help you.
Don't forget to stay updated with our daily social media posts on Facebook.
Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach.
Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.
No unauthorised use, duplication, distribution or modification to any original content contained within this blog is permitted without prior written permission of the author. All other trademarks and registered names are acknowledged.
