Currently non UK residents working overseas can pay Class 2 National Insurance Contributions of £2.85 per week, or an annual cost of £148, to maintain the minimum qualifying years required to be eligible for UK State Pension. These contributions additionally allows those individuals access to certain other allowances such as bereavement benefits.
With the abolishment of Class 2 National Insurance next April, the only option for non UK residents to maintain these benefits in the UK, is to instead to pay Class 3 National Insurance, but these contributions are currently £14.25 per week, or £741 per annum, representing a 500% increase for those affected!
It is still not clear how HMRC will deal with the administration of transferring those currently paying Class 2 onto paying Class 3, but watch this space for details…
To discuss any of the issues raised in this blog please contact Natalie Butler, Assistant Manager (firstname.lastname@example.org) or your usual AAB contact.