Extending the voluntary National Insurance contributions deadline
Updated 20 July 2023
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On 12 June 2023, the government announced that the voluntary National Insurance contributions deadline has been extended to 5 April 2025.
For more information read Deadline for voluntary National Insurance contributions extended to April 2025.
Who is likely to be affected
Individuals who want to pay voluntary National Insurance contributions (NICs) and would not have otherwise met the existing 5 April 2023 deadline.
General description of the measure
The government is extending the deadline to 31 July 2023 for individuals to pay voluntary NICs. Paying voluntary NICs enables customers to fill any gaps in their National Insurance (NI) record to boost their State Pension.
Individuals can usually only fill gaps in their NI record from the past 6 years. However, as part of transitional arrangements introduced alongside the new State Pension from April 2013 individuals were given until 5 April 2023 to pay voluntary NICs to make up any gaps in their NI record between 6 April 2006 and 5 April 2016.
The 5 April 2023 deadline is being extended to 31 July 2023.
The government is also extending the deadline to pay voluntary NICs for tax year 2016 to 2017, to 31 July 2023.
By extending the deadline individuals have more time to decide whether to fill gaps in their NI record to count towards their State Pension and to pay voluntary NICs.
Policy objective
As the 5 April 2023 deadline to pay voluntary NICs approaches, HMRC and the Department for Work and Pensions (DWP) have experienced an exceptional increase in customer contact.
To ensure customers are treated fairly and given an equal chance to fill in gaps in their NI record, the government has decided to extend the deadline for paying voluntary NICs to 31 July 2023.
This applies to years that would otherwise have been out of time to pay after 5 April 2023, from tax year 2006 to 2007 up to and including tax year 2016 to 2017.
All voluntary NICs payments will be accepted at the existing 2022 to 2023 rates until 31 July 2023.
As voluntary NICs do not always increase an individual’s State Pension entitlement, for example where an individual already has sufficient qualifying years to claim the full State Pension, customers are advised to contact DWP to check that paying voluntary NICs will benefit them, before making payment to HMRC.
Background to the measure
The government announced this measure in a written ministerial statement on 7 March 2023.
Detailed proposal
Operative date
The measure will have effect from 5 April 2023.
Current law
Current law is contained in Sections 12(3) and 13(6) of the Social Security Contributions and Benefits Act 1992 and the Social Security Contributions and Benefits (Northern Ireland) Act 1992.
Other relevant legislation includes Regulations 50C and 61B of the Social Security (Contributions) Regulations 2001 (S.I. 2001/1004).
Proposed revisions
These regulations extend the deadline for paying voluntary NICs for tax years between 6 April 2006 and 5 April 2016, to 31 July 2023.
It also extends the deadline for paying voluntary NICs for the 2016 to 2017 tax year, to 31 July 2023.
It applies the 2022 to 2023 rates to payments of voluntary NICs made before the new 31 July 2023 deadline for all years which would otherwise become payable at a higher rate on 6 April 2023.
The instrument amends the Social Security (Contributions) Regulations 2001 (S.I. 2001/1004).
Summary of impacts
Exchequer impact (£ million)
| 2022 to 2023 | 2023 to 2024 | 2024 to 2025 | 2025 to 2026 | 2026 to 2027 | 2027 to 2028 |
|---|---|---|---|---|---|
| empty | empty | empty | empty | empty | empty |
The final costing will be subject to scrutiny by the Office for Budget Responsibility and will be set out at a future fiscal event.
Economic impact
This measure is not expected to have any significant economic impacts.
Impact on individuals, households and families
The measure will impact individuals who may have gaps in their NI record and would benefit from paying voluntary NICs as part of the transitional arrangements that accompanied the introduction of the new State Pension.
It will also impact individuals who are filling in gaps in their NI record for the past 6 years.
Providing an extension until 31 July 2023 ensures that individuals are given enough time to decide if they would like to fill in any gaps to count towards their State Pension entitlement.
Customer experience is expected to improve as the extension will reduce congestion on the telephone lines and ensure that more customer service advisors will be able to assist with customer queries.
The measure is not expected to impact on family formation, stability or breakdown.
Equalities impacts
These changes to voluntary NICs apply regardless of personal circumstances or protected characteristics such as sex, race or disability.
The measure is more likely to benefit older people approaching State Pension age, those who have reached State Pension age and women who are more likely to have gaps in their Nl record.
It is not anticipated that there will be impacts on other groups sharing protected characteristics.
Impact on business including civil society organisations
There is no impact on business as it only affects individuals.
Operational impact (£ million) (HMRC or other)
By extending the deadline, HMRC and DWP expect to be able to manage customer contact with existing staff resources. The operational impacts are, therefore, expected to be negligible.
Other impacts
Other impacts have been considered and none have been identified.
Monitoring and evaluation
The measure will be kept under review through communication with affected taxpayer groups.
Further advice
If you have any questions about this change, contact the National Insurance contributions Policy Team at: nics.correspondence@hmrc.gov.uk.
Declaration
Victoria Atkins MP, Financial Secretary to the Treasury has read this tax information and impact note and is satisfied that, given the available evidence, it represents a reasonable view of the likely costs, benefits and impacts of the measure.