Topping up state pension to become easier with new online tool

An online service designed to simplify how you check your state pension and pay for missing National Insurance (NI) credits is due to launch within the next six months.

Many people have bought extra NI credits this year and boosted their state pension by thousands of pounds. The government has extended the state pension top-up deadline several times due to huge demand - you now have until April 2025.

But it is still time-consuming and complex to check and buy missing NI contributions; it requires a phone call to the Pensions Service and then another one to HMRC to get an 18-digit payment number, and some people have faced long wait times to get through on the phone lines.

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However, the good news is the government has confirmed it is setting up a digital tool to make the process easier.

We explain how it will work and when it will become available. 

How will the online state pension service work? 

HMRC and the Department for Work and Pensions are working together to launch an online service, which the “vast majority of customers” should be able to use to check and top up their state pension.

The new service will contain information to help customers decide which years they may wish to make up shortfalls on, based on which gap years are available for them to fill and the cheapest or most beneficial years to pay voluntary NI contributions for. Customers will then be able to pay online, should they decide to do so.

The service will also give state pension estimates and forecasts based on National Insurance records. 

It is aimed at people who want to check and pay for NI credits quickly, and who do not need to speak to a government adviser before paying for voluntary contributions.

A government spokesperson said: “We are building a new online service to allow people to see if making voluntary National Insurance contributions would increase their state pension and then make any payments.

“The new service is currently being developed and tested to make absolutely sure it is easy to use and provides accurate information in a straightforward way.”

When will it launch? 

The government says it is aiming to introduce the service later in the financial year 2023-24. This means it should launch sometime in the next six months, before 6 April 2024.

Once the online tool is ready, the guidance on gov.uk around how to check your NI record and top up your state pension will be updated to explain how to use the new service.  

Can I still get advice and top up my pension over the phone?

Yes, if you feel more comfortable talking to someone over the phone, you can continue to call up to find out about your NI record, state pension forecast, and to pay for any missing years – and you'll still be able to do so once the online service has launched.

Contact the Future Pension Centre on 0800 731 0175, or if you're already at state pension age, contact the Pension Service helpline on 0800 731 0469.

How much can I boost my state pension by? 

Buying extra NI credits can be a great way to boost your state pension income with very little risk.

Spending £907 to purchase NI credits (which is one year of NI contributions) could unlock up to £7,740 in extra income over a typical 20-year retirement period.

According to the investment platform Interactive Investor, somebody purchasing 10 years of NI contributions at a cost of £9,070 (10 X £907) could boost their state pension by £77,400 over a 20-year retirement, £33,946 over a decade and £15,927 over five years.

Note the exact cost of buying a year of NI credits varies depending on which year it relates to, and whether they are class 2 or class 3.

To boost your pension entitlement, you can normally buy up to six NI years to fill any gaps. For example, if you've had a break from work to raise children or care for elderly relatives. You usually need 35 full NI years to get the current maximum state pension of £203.85 a week. This means if you have gaps in your record and don’t have 35 years of NI contributions, you may not receive a full state pension later in life.

However, when the new state pension was introduced in 2016, the government made it possible to plug gaps all the way back to 2006.

Right now, you have until 5 April 2025 to buy voluntary National Insurance credits to fill any gaps dating back to April 2006. After that, you can only buy credits going back six years.