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[ronnyd]

I decided to stay in SERPS when my company went from final salary to money purchase, (or whatever it,s called now). I,m glad i did as i got the maximum from my Serps plus a small amount from my private pension.  I also paid NI contributions for all my working life, 49yrs. Have i paid too much? I know this no help to you Dean but i hope you get something sorted out soon mate.

[STEMO]

The only reason I protest is that two people earning 40K each could still get it. Apparently, the government couldn't be arsed said it would be too expensive to trawl through people's details to see what couples earn.

Sorry...should have 'quoted'.....child benefit I'm on about.

[STEMO]

Oh....and my wife earns much more than £1K a week.

[LC0112G]

I know this no help to you Dean but i hope you get something sorted out soon mate.

Agree. Moggie, get yourself down the job centre and sign on if you haven't already. Then off to Citizens advice and see if you can claim any other benefits. It's what your previous years NI and tax payments have entitled you to.

Have i paid too much?

No. NI is not optional. If you work, are less than SP age, and earn more than £156 p/w then your employer must deduct NI from your salary. You may wind up paying 49 years of NI stamps when only 30/35 were/are required for a full SP, but there is/was never an option to not pay NI.

I decided to stay in SERPS when my company went from final salary to money purchase, (or whatever it,s called now). I,m glad i did as i got the maximum from my Serps plus a small amount from my private pension.

99.99999% of the time it is best to join a company pension scheme, whether final salary or money purchase, because the company makes contributions in addition to your own - thus often at least doubling your money. It's free money - daft to turn it down. Most (all?) final salary schemes were contracted out of SERPS. Money purchase schemes could be either, but there usually wasn't a choice of whether to opt in/out of SERPS - if you wanted to join a company scheme of whatever type you had to opt out if it was an opted out scheme. Regardless, it was best to accept the companies 'free money' even if you did have to give up SERPS.

For people without access to any company pension, you could chose to stay contracted in and build up SERPS, or to contract out, and have the SERPS bit of your NI paid into a private pension plan. There was a review a few years back which concluded that it was best to be contracted out if you were 45 or less, but contracted back in if you were >45.

The point is mute now though - All private pensions were forced to contract back into SERPS in 2012, and all company pensions were forced to contract back in last year. And this year, SERPS is abolished entirely and rolled up into the new state pension.

[ronnyd]

Thanks for that info LCO112G

[omega2018]

No - SERPS was earnings related extra pension, on top of the £115 basic state pension you can get if you have paid enough (30) years ni.

The COPE is an estimate of what your private pension will pay you in addition to whatever new state pension you get. The state is not going to pay you £199.20.

In effect they are saying that if you had not contracted out, then your basic+serps amount would/might/could/may have been £199.20. However, since you did contract out, your state pension will be £155, and your private contracted out scheme should pay you £43 instead. What your private pension actually does pay you depends upon what it's been invested in - it might be £43, or any amount from £0 to £squillions.

They are forecasting you will get £155 state pension when you retire - they aren't saying that you already have £155 'banked'. How old are you? Providing you have more than 8 years to go till your state pension age, AND by the time you retire you will have at least 35 years NI credits then you'll get the £155, because from now on the basic £115 will increase by £4.45 a year till you reach the new maximum of £155.

Anyone who was contracted out for long periods is very unlikely to have much more than £115 already 'banked'. I was contracted out for 20+ years, and I've currently got 31 years NI credits. My state pension estimate as of today is £120 ish. But since I've got more than 8 years till I reach state pension age, I should reach the 35years/£155 maximum. The only people that won't get £155 are those that were contracted out for a long time and reach retirement age within the next 8 years, and/or those who don't have 35 years NI credits.

i think maybe we're discussing at cross purposes and it is complicated by the new pension.  i have 35 years NI as at april this year, i was contracted out from SERPS for probably 10 years of those years, but  i will get the new state pension of £155 at current prices (because of my 35 full years). agreed i won't get more than £155 from the state   because i was contracted out of SERPS which was for additional pension above £155.  i don't plan on paying anymore NI and i don't retire for another 9 years. 

my statement is ambiguous though, they seem to think i will keep paying ni but i don't see any need since i already have the 35 years....

[TheBoy]

they seem to think i will keep paying ni but i don't see any need since i already have the 35 years....

My understanding is you will always pay NI, subject to earnings etc, as it covers more than just pension.  Think of it also including your "health insurance" (ie, NHS), which you have to pay whilst earning.

[omega2018]

they seem to think i will keep paying ni but i don't see any need since i already have the 35 years....

My understanding is you will always pay NI, subject to earnings etc, as it covers more than just pension.  Think of it also including your "health insurance" (ie, NHS), which you have to pay whilst earning.

not if you're self employed and stay below the earnings limit. also no ni on any non state pension payments you are already receiving, which you can take from age 55 (was 50) although they are of course taxable.

[LC0112G]

i think maybe we're discussing at cross purposes and it is complicated by the new pension.  i have 35 years NI as at april this year, i was contracted out from SERPS for probably 10 years of those years, but  i will get the new state pension of £155 at current prices (because of my 35 full years). agreed i won't get more than £155 from the state   because i was contracted out of SERPS which was for additional pension above £155.  i don't plan on paying anymore NI and i don't retire for another 9 years. 

my statement is ambiguous though, they seem to think i will keep paying ni but i don't see any need since i already have the 35 years....

The statement isn't ambiguous - you just haven't understood what they're telling you and you are in for a shock. 35 Years of NI does not get you £155 if you have been contracted out at any time in the past. It works like this....

Firstly, the govt calculate your "starting amount" as at 5/4/2016 based on the new and old rules.

Under the old rules, your starting amount is 30/30ths of the basic £115, plus some SERPS/S2P. From the figures you've posted we can calculate that if you had not been contracted out, then under the old rules you would've got SERPS of (£199.20-£115) = £84.20. However, you have been contracted out so your old rules starting amount will be very close to £115. It may be a bit more than £115 because of years you were opted in, but probably not by very much.

Under the new rules, your starting amount is 35/35ths of the 'flat rate' £155 minus the COPE amount of £43.55, which is £111.45.

So under old rules your starting amount as is £115 ish, and under the new rules the starting amount is £111 ish. Your actual starting amount is whichever is the higher of these two figures, which in your case is the old rules amount of £115 ish. Therefore as of 5/4/2014 you have 'banked' £115 of state pension.

It matters not if you have 35, 40, 45 or 50 years now - as things stand you will only get your starting amount. In order to get more state pension you need to either earn, be credited with, or pay for some additional post 2016 NI 'stamps'. Each additional post 2016 year will add £4.55 to your starting amount, so you are likely to need several (up to 8 ) years of additional stamps to qualify for the full £155 new state pension.

However - since you have 8 years till pension age, and you are continuing to work, you should reach the £155 target - but you're not there yet.

...they seem to think i will keep paying ni but i don't see any need since i already have the 35 years....

You can't stop paying NI even if you have reached full 35 years. It's not optional, and there is no way to opt out. You must pay it, even if it gives you no benefit. 

[omega2018]

i think maybe we're discussing at cross purposes and it is complicated by the new pension.  i have 35 years NI as at april this year, i was contracted out from SERPS for probably 10 years of those years, but  i will get the new state pension of £155 at current prices (because of my 35 full years). agreed i won't get more than £155 from the state   because i was contracted out of SERPS which was for additional pension above £155.  i don't plan on paying anymore NI and i don't retire for another 9 years. 

my statement is ambiguous though, they seem to think i will keep paying ni but i don't see any need since i already have the 35 years....

The statement isn't ambiguous - you just haven't understood what they're telling you and you are in for a shock. 35 Years of NI does not get you £155 if you have been contracted out at any time in the past. It works like this....

Firstly, the govt calculate your "starting amount" as at 5/4/2016 based on the new and old rules.

Under the old rules, your starting amount is 30/30ths of the basic £115, plus some SERPS/S2P. From the figures you've posted we can calculate that if you had not been contracted out, then under the old rules you would've got SERPS of (£199.20-£115) = £84.20. However, you have been contracted out so your old rules starting amount will be very close to £115. It may be a bit more than £115 because of years you were opted in, but probably not by very much.

Under the new rules, your starting amount is 35/35ths of the 'flat rate' £155 minus the COPE amount of £43.55, which is £111.45.

So under old rules your starting amount as is £115 ish, and under the new rules the starting amount is £111 ish. Your actual starting amount is whichever is the higher of these two figures, which in your case is the old rules amount of £115 ish. Therefore as of 5/4/2014 you have 'banked' £115 of state pension.

It matters not if you have 35, 40, 45 or 50 years now - as things stand you will only get your starting amount. In order to get more state pension you need to either earn, be credited with, or pay for some additional post 2016 NI 'stamps'. Each additional post 2016 year will add £4.55 to your starting amount, so you are likely to need several (up to 8 ) years of additional stamps to qualify for the full £155 new state pension.

However - since you have 8 years till pension age, and you are continuing to work, you should reach the £155 target - but you're not there yet.

...they seem to think i will keep paying ni but i don't see any need since i already have the 35 years....

You can't stop paying NI even if you have reached full 35 years. It's not optional, and there is no way to opt out. You must pay it, even if it gives you no benefit.

thanks this is helpful but i definitely don't pay ni nor do they bill me it.

also my statement says

"Your State Pension forecast    £155.65
Your COPE estimate    £43.55
COPE added to your State Pension forecast    £199.20"

it says COPE is added (although by my pension provider) not deducted.

also to assist here is an example from them:


"Example – the amount under the new scheme rules is higher
On 6 April 2016, Jim has 32 qualifying years on his NI contribution
record. He has been self-employed for long periods of his working
life.
Using the new State Pension scheme rules, Jim would get £135.68
a week (£148.40 [now £155.65]x 32/35ths).
Using the existing scheme rules, Jim would get £126.50 a week
(basic State Pension of £113.10 and £13.40 additional State
Pension).
Jim’s starting amount will be the higher of these two amounts,
which is £135.68 a week."

[moggy]

I decided to stay in SERPS when my company went from final salary to money purchase, (or whatever it,s called now). I,m glad i did as i got the maximum from my Serps plus a small amount from my private pension.  I also paid NI contributions for all my working life, 49yrs. Have i paid too much? I know this no help to you Dean but i hope you get something sorted out soon mate.

Thanks for your concern mate,much appreciated.Dean 

[05omegav6]

As an employee, Class one exemption threshold is £112 per week... less than this and you don't pay, between £155 pw and £827 pw and generally you pay 12%

As here... https://www.gov.uk/guidance/rates-and-thresholds-for-employers-2016-to-2017

Self employed, you pay  £2.80 pw Class 2 if you clear £5965 profit, plus a profit related 9% on anything from £8060 to £43000.

As here... https://www.gov.uk/self-employed-national-insurance-rates

This also might be useful reading... https://www.gov.uk/voluntary-national-insurance-contributions/why-pay-voluntary-contributions

Can be a trawl to find it, but lots of information there

[moggy]

I know this no help to you Dean but i hope you get something sorted out soon mate.

Agree. Moggie, get yourself down the job centre and sign on if you haven't already. Then off to Citizens advice and see if you can claim any other benefits. It's what your previous years NI and tax payments have entitled you to.

Have i paid too much?

No. NI is not optional. If you work, are less than SP age, and earn more than £156 p/w then your employer must deduct NI from your salary. You may wind up paying 49 years of NI stamps when only 30/35 were/are required for a full SP, but there is/was never an option to not pay NI.

I decided to stay in SERPS when my company went from final salary to money purchase, (or whatever it,s called now). I,m glad i did as i got the maximum from my Serps plus a small amount from my private pension.

99.99999% of the time it is best to join a company pension scheme, whether final salary or money purchase, because the company makes contributions in addition to your own - thus often at least doubling your money. It's free money - daft to turn it down. Most (all?) final salary schemes were contracted out of SERPS. Money purchase schemes could be either, but there usually wasn't a choice of whether to opt in/out of SERPS - if you wanted to join a company scheme of whatever type you had to opt out if it was an opted out scheme. Regardless, it was best to accept the companies 'free money' even if you did have to give up SERPS.

For people without access to any company pension, you could chose to stay contracted in and build up SERPS, or to contract out, and have the SERPS bit of your NI paid into a private pension plan. There was a review a few years back which concluded that it was best to be contracted out if you were 45 or less, but contracted back in if you were >45.

The point is mute now though - All private pensions were forced to contract back into SERPS in 2012, and all company pensions were forced to contract back in last year. And this year, SERPS is abolished entirely and rolled up into the new state pension.

I will get myself down to the jobcentre,and the cab.But there are a few problems ie the landlord will not accept housing benefit payments.Also we both have a loan and a credit card,with the bank.So if they are not being paid the bank will just close our accounts,and then take recovery action.On top of which all our other bills wont be paid gas,electric,car insurance etc.So unless we can find work we are up shit creek without a paddle,we have signed up with 10 agency's.And i have lost track of how many cvs i have sent out,but still no work i will just have to keep trying.Until we have no money left of cause.Dean

[moggy]

 

As an employee, Class one exemption threshold is £112 per week... less than this and you don't pay, between £155 pw and £827 pw and generally you pay 12%

As here... https://www.gov.uk/guidance/rates-and-thresholds-for-employers-2016-to-2017

Self employed, you pay  £2.80 pw Class 2 if you clear £5965 profit, plus a profit related 9% on anything from £8060 to £43000.

As here... https://www.gov.uk/self-employed-national-insurance-rates

This also might be useful reading... https://www.gov.uk/voluntary-national-insurance-contributions/why-pay-voluntary-contributions

Can be a trawl to find it, but lots of information there

Thanks mate,i will have a read through it :yDean.

[05omegav6]

Speak to Stepchange re your debts.

Would strongly recommend ringing them first thing

http://www.stepchange.org/

Pension side of things is currently irrelevant to you, but thread was side tracked...

Have a look at that link, fill in the online review (Debt Remedy) for your basic options, then ring them in the morning to discuss them