Topping up your state pension: Don’t miss the deadline

For the vast majority of people in the UK, pensions form a critical part of retirement planning. Those pensions come in many forms – from the state pension through to work and private pensions – and will provide varying levels of income once they become available or you opt to start taking payments.

The full rate of the new state pension (for the tax year 2024/25) is £221.20 per week – or just over £11,000 per year. In 2025/26, this will rise to £230.25 – or £11,973 per year. The state pension increases every year based on a system known as the ‘triple lock’.

Even for those who have a private pension, this is a not-insubstantial amount that can play an important part in delivering the lifestyle you want in retirement. This can be even more significant if you’re married or in a civil partnership and you’re both eligible for the state pension. 

However, not everyone is entitled to the full payment. Your weekly payment could be different depending on:

• If you were contracted out before 2016
• If you paid into the additional state pension before 2016; and
• The number of National Insurance (NI) qualifying years you have.

It’s the last point that’s exceptionally pertinent right now. As a general rule of thumb, you need at least 35 years of NI contributions in order to receive the full amount – if you’ve made between ten and 34 years of contributions, you’ll receive a proportion of that full amount.

Making voluntary NI payments

“There are many reasons why someone might not have made the full 35 years of contributions,” explains Shazna Bishop, Financial Planner and Divisional Director with RBC Brewin Dolphin. “You may have taken a break from work – to look after children, for example – or you may have lived and worked abroad for some of this time.”

Fortunately, the government allows individuals to make voluntary NI contributions (NICs) to fill any gaps in their record – these are typically Class 3 NICs. The cost of filling the gaps depends on the rate charged in those years. In 2024/25, for instance, the charge is £907.40 for the year, whereas it’s £800.80 for 2021/22.

The benefits of topping up in this way can be significant. Filling in a missing year will usually boost your state pension by 1/35th of the standard rate. That works out around £329 a year based on the full level of state pension in 2024/25. Over a 20-year retirement, that would add up to an extra £6,000 – all in exchange for a payment of just £907.40 (based on the cost for 2024/25).¹

Under normal circumstances, people are allowed to make voluntary NICs going back six years, but in 2013, the government introduced a rule that meant that top-ups could go back to 2006. This rule has remained in place. Effectively, this means that in the 2024/25 tax year, you can make voluntary payments for any of the past 18 years.

Crucially, however, this is being removed from 6 April 2025, and the lookback period will revert to only six years.

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Is it worth topping up my state pension?

With this in mind, there’s a real sense of urgency if you don’t want to lose the opportunity to top up any missing years from 2006 onwards. However, it’s essential to first establish if you can make voluntary payments and whether it will actually be worth doing so.

There are various scenarios where buying voluntary NI contributions might not be beneficial – for example, if you were ‘contracted out’ of the additional state pension before 2016. 

“The first port of call is to get a state pension forecast,” says Bishop. “The easiest way to do this is through the Government Gateway. This will show you what your expected pension will be, where there are any gaps and the cost of filling them. From there you can decide the best way forward.”

Could you be missing out?

“People will have their own reasons for not checking,” says Bishop. “They may have assumed they’re getting the full amount or assumed they’re not getting the full amount and have left it at that. But making such assumptions can result in a significantly reduced state pension.”

This is particularly true for parents who have stayed at home to raise children, who may be thinking that their NICs are being made automatically or that they weren’t entitled to contributions.

From 1978/79 to 2009/10, protection for parents staying at home was provided through Home Responsibilities Protection (HRP), a main condition of which was for the parent at home to be claiming Child Benefit. HRP was changed in 2010/11 to National Insurance credits.

Unfortunately, owing to data issues, research by the Department for Work and Pensions in both 2011 and 2022 showed that many parents were missing out because details weren’t recorded accurately or information was missing. As a result, HRPs weren’t showing in many people’s forecasts. The government has initiated a programme to start remedying this situation.

Critically, in relationships where the working partner was earning a high salary, some spouses didn’t apply for Child Benefit because they didn’t think it was necessary or appropriate. However, only by claiming Child Benefit were they able to receive the appropriate credits.

In April 2023, the government announced it will legislate to introduce a route for parents to apply for NICs where they haven’t claimed Child Benefit, to ensure that people don’t miss out on their state pension entitlement. Individuals will be able to claim this credit from April 2026.

Clearly, in relationships where one partner has worked and the other has stayed at home to raise children, it makes clear sense for both to check their current forecast and take action from there.  

Looking at pensions holistically

“When we talk to clients about retirement – probably the most important question is what income they think they’ll need to maintain the lifestyle they want,” says Bishop. “We then break down the different sources they’ll get their income from. One of the sources, obviously, is the state pension.”

Just as much as you might choose to maximise a personal pension, it makes sense to, at the very least, consider maximising your state pension. At the time of writing, you have the chance to go back 18 years, but even once that changes in April 2025, you can still look back six years.

While there may be downsides to making additional contributions – the main one being that if you pass away before you take your pension, then you won’t benefit from the top-up that you’ve made – there are many more positives to consider. Starting with your state pension forecast will give you a much clearer picture.

Next steps

How much you really need to save for retirement is a complex calculation, and that’s where getting some financial advice comes in.

In addition to your pension, a financial adviser can help with:

• Creating and maintaining your risk and investment strategy
• Maximising the tax allowances available to you
• Ensuring your pension death benefit nominations (who you wish to receive your pension if you pass away before you claim your pension benefits) are up to date
• Providing advice on current fees

¹ https://www.which.co.uk/money/pensions-and-retirement/state-pension/can-i-top-up-my-state-pension-aVwgx1p28af4

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The value of investments, and any income from them, can fall and you may get back less than you invested. This does not constitute tax or legal advice. Tax treatment depends on the individual circumstances of each client and may be subject to change in the future. You should always check the tax implications with an accountant or tax specialist. Information is provided only as an example and is not a recommendation to pursue a particular strategy. Information contained in this document is believed to be reliable and accurate, but without further investigation cannot be warranted as to accuracy or completeness.