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State pensions

Chances are, you're already receiving the basic State Pension. The amount you are receiving depends on how many qualifying years you built up while you were working. Qualifying years are the years in which you paid or were treated as paying National Insurance contributions. In certain circumstances, you may have been credited with National Insurance contributions even if you were unable to do paid work.

You may also be getting additional State Pension. This is the earnings-related element of State Pension, paid on top of your basic State Pension. You may know this better as SERPS (the State-Earning Related Pension Scheme). SERPS was replaced by the State Second Pension from April 2002. The amount you receive from this pension is based on your record of National Insurance contributions and your level of earnings when you were an employee.

What if there are gaps in my National Insurance contributions?

Some people who reached State Pension age after 6 April 1998 may be unaware that they could have gaps in their National Insurance record between April 1996 and March 2002. These gaps may have had an effect on their entitlement to state benefits including the basic State Pension.

A small number of these people may be able to improve their basic State Pension entitlement by paying voluntary National Insurance contributions now that HM Revenue & Customs has extended the deadline for doing so. Visit HM Revenue & Customs website to find out about voluntary National Insurance contributions

You will not be one of the customers affected if:

  • you already receive the full basic State Pension (82.05 at April 2005/2006)
  • you reached State Pension age before 6 April 1998

If it appears from our records and those of HM Revenue & Customs that you may be affected, we will write to you. We started to send out letters at the end of September 2004 and it will take about a year for all letters to be sent to those customers who may be affected.

The letter will tell you:

  • whether you have a gap in your National Insurance record, which you can fill by paying voluntary contributions
  • how the payment of voluntary contributions will affect your State Pension
  • the options available to you for paying these voluntary contributions
  • how much you can pay and when you need to pay by

There is no obligation for you to pay these voluntary contributions, but we want to make sure you have the information you need to be able to make your decision.

If you think you may be affected and you have not received a letter from The Pension Service by September 2005 you should contact your nearest pension centre or social security office for advice.

Find out more about voluntary National Insurance contributions on HM Revenue and Customs website

What if I'm not receiving any State Pension?

If you are not receiving any State Pension because you think you do not have enough qualifying years or you think you may not be eligible for some other reason, you should still claim. You may be entitled to State Pension and you could be missing out. You should contact The Pension Service through your local social security office or pension centre who will tell you where to get an invitation to claim.


More about state pensions

You can read and print or order a copy of State pensions - Your guide from our resource centre.

Pensions Tax Simplification

From 6 April 2006 there will be a new tax regime for pensions called Pensions Tax Simplification. It will replace the eight existing tax regimes with one. Find out more about Pensions Tax Simplification on HM Revenue & Customs website


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