HMRC error means some self-employed workers could lose out on state pension

An HMRC error could mean that some low-income, self-employed workers lose out on their entitlement to National Insurance-related benefits like the state pension.

The issue centres around the payment of voluntary Class 2 National Insurance contributions (NICs) that can be made by self-employed taxpayers with profits under £6,725. 

These voluntary contributions are usually paid by taxpayers as part of their self assessment return and must reach HMRC by 31 January following the end of the tax year. 

HMRC then automatically transfers the NICs to the taxpayer's National Insurance record to be counted towards their entitlement to benefits. 

However, it appears that HMRC did not initiate the transfer until after the 31 January deadline for the 2022/23 tax year resulting in the voluntary contributions being rejected and automatically refunded to the taxpayer. 

In the absence of any action, this could mean that taxpayers miss a qualifying year of NICs. 

If you believe you may be affected please contact us to discuss checking your NIC record. 

info@ellisatkins.co.uk
01306 886681