State pension scheme

The UK state pension scheme is something that in some part will impact on us all in retirement.
The Basic State Pension (BSP) was introduced for those not paying enough National Insurance Contributions (NIC’s).
Running along side of this we have a contribution based system which started with the Graduated Pension Benefit (GPB), this was replaced by the State Earnings Related Pension Scheme (SERPS), which in turn was replaced by the State Second Pension scheme (S2P).
As of 06/04/2016 there is now a New State Pension and there are some subtle changes you need to be aware of which could have an effect on your benefits.
For example under the old regime to accrue maximum benefits you needed to have made 30 years of NIC’s now under the new regime it needs to be 35 years.
Under the old regime to gain any benefit you needed to have made at least one year of NIC’s now it is a minimum of 10 years, so if you make 9 years there will be no state pension.
The NIC’s are calculated on “band” earnings which start at £5824 per annum.
Under the new regime scheme the notional maximum payment you can accrue is £155.65 per week (£8093.80 per annum), however this can be less or it can be more.
If you are concerned and need to check your state pension forecast go to
Or call 0345 3000168.
If you are underfunded you can make voluntary NIC’s.
If you are self employed these are class 2 and these are £2.80 per week or £145.60 per annum.
For anyone else it is class 3 and these are £14.10 per week or £733.20 per annum.
If you live abroad and are not working it can be possible to make class 3 contributions but this is subject to certain conditions being met.
For any advice on retirement planning please contact us as per the details below

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