National Insurance ..

[ASB]

I think you should pay some NI just for the qualifying years.
State pension won't be much but will always be set at level that a pensioner could live on. I can't imagine any government in their right mind will allow pensioners to be completely destitute ... they would just get voted out.
It won't be much but it will be something extra to top up with.

http://www.direct.gov.uk/en/MoneyTax...nt/DG_10021384

What is a qualifying year?

You need to earn a minimum amount (£4,680 per year in 2008-2009) for it to count as a qualifying year.

How many qualifying years do you need?

Currently men normally need 44, and women normally need 39 qualifying years to get the full State Pension.

However, if you reach State Pension age on or after 6 April 2010 you will need 30 qualifying years for a full Basic State Pension.

A qualifying year does not necessarily cost you anything in NI, NI payable is nil on a salary between 4680 and 5460.

Also it "may not be very much" but the maximum "basic" is currently 4716 per year. To buy this pension (escalating by RPI single life no guarantee - i.e. pretty much the basis the state pays it on) would require a fund of approximately 100,000.

To my mind it's a complete no-brainer to ensure one has the required qualifying years.

[hgllgh]

I think you should pay some NI just for the qualifying years.
State pension won't be much but will always be set at level that a pensioner could live on. I can't imagine any government in their right mind will allow pensioners to be completely destitute ... they would just get voted out.
It won't be much but it will be something extra to top up with.

[williamdavis]

I called NI a couple of weeks ago, service was fantastic!

I was so surprised what with it being a Government agency, just have a chat with them but you do want to make some kind of contribution for NHS, benefits and state pension purposes.

[Fred Bloggs]

What you don't get of course is serps or s2p or whatever it is called at the moment. I believe you can now get a pension forecast on line too.

Thanks ASB, last time I looked you couldn't get a forecast until a new IT system is installed at the DWP. Best not hold my breath waiting for that to happen..........

[ASB]

Hmmm, that I didn't realise. Presently I'm paying myself £10k salary but that's going to change. So......... I can pay myself £1 above the LEL and still get NI credit? Yes, I'm an old bugger, many a good tune etc.......

What you don't get of course is serps or s2p or whatever it is called at the moment. I believe you can now get a pension forecast on line too.

[Fred Bloggs]

Fred, that's 'cos you're an old bugger. However currently if you have earned income above the LEL this gets you 1 years credit. Event though the NI payment is nil.

Hmmm, that I didn't realise. Presently I'm paying myself £10k salary but that's going to change. So......... I can pay myself £1 above the LEL and still get NI credit? Yes, I'm an old bugger, many a good tune etc.......

[ASB]

There's changes happening in 2010 (I think) where many of us a bit older will qualify for a state pension on much lower years of contributing. I forget the exact deets at the moment but I would already qualify I believe as I've paid 35 years of NI already.

Fred, that's 'cos you're an old bugger. However currently if you have earned income above the LEL this gets you 1 years credit. Event though the NI payment is nil.

[Fred Bloggs]

There's changes happening in 2010 (I think) where many of us a bit older will qualify for a state pension on much lower years of contributing. I forget the exact deets at the moment but I would already qualify I believe as I've paid 35 years of NI already.

[Gonzo]

If I pay myself the absolute minimum salary ( 5K odd ) and take whatever else needed as dividends, do I need to pay NI, as this is at ET?

Or is it a case that I dont have to but its advisable i should?

You may want to think about the implications of not paying any NI at all on your qualifying years for the state pension.

A fairly chunky bit of thinking needs to be done just to work that bit out, before you start to think what the state pension is likely look like by the time that you could receive it and whether it is worth worrying about at all.

[Archangel]

No

No

HTH

[skelm]

If I pay myself the absolute minimum salary ( 5K odd ) and take whatever else needed as dividends, do I need to pay NI, as this is at ET?

Or is it a case that I dont have to but its advisable i should?