You Have Received a Statement Letter from HMRC:

Here are the necessary steps to consider and take action on.

This information is given by our company (UK State Pension Abroad) for illustrative purposes only and while it may cover 95% of the differing cases, it needs to be considered alongside your own situation and is your responsibility. UK State Pension Abroad always provide information never pension or financial advice. If you require pension advice, please contact your financial advisor.

The Statement should look something like this

PERHAPS YOU RECEIVED 2 LETTERS THAT SEEM TO PROVIDE CONFLICTING INFORMATION

– IF SO CLICK HERE

– IF NOT Please Continue Below

INTRODUCTION
When reading the statement please remember that your objective here is to achieve a full  35 year maximum UK State Pension entitlement (the payout figures will be shown later), or as close to 35 years as your record or age will allow.

Optimising your UK State Pension -It is a combination of 3 elements

Existing Qualifying Years + Past Allowable years + Future years to which you can contribute = total number of years

1. First thing to check is on the First Page of the statement under the title

That represents confirmation of what is already on your record

2. The second thing is to examine how many years they are allowing you to buy back.

This will be on the 2nd Page (and possibly extend to Page 3) in a table. You can count up how many years are offered

They may be all in one Class or a combination of:

– Class 2 (costing appx £163-179 per year)

– Class 3 (costing appx £795-907 or more)

– A mix of some weeks at Class 2 and some weeks at Class 3

Why are some years Assessed at Class 2 and some at class 3?

They assess the classification based on the years or parts of years where you were employed or self employed abroad from the UK. When you were/are employed it is Class 2, and when no, it is assessed by HMRC as Class 3.

The UK Budget announcement of Nov 25th disallows any Class 2 for non UK Residents from 2026/27 onwards but SHOULD NOT impact any applications for Class 2 designation for all years prior to 2026 (for more details CLICK HERE )

3. The third element to examine is how many years are left until your 67th Birthday (date when you are due your pension).

You can continue to contribute forward year by year into the future to get as close to 35 years as possible. The UK Budget announcement of Nov 25th disallows any Class 2 for NON UK Residents from 2026/27 onwards. The next year 2025/26 can still be offered at Class 2 if appropriate but beyond this, Class 3 (appx £930per annum cost will apply) For further details click here 

Examining the Details

Once you add the existing qualifying years to the number of years you can buy back that gives you a number. Then you calculate how many more years until your 67th birthday.

Requesting a Receipt from HMRC

This is a really important thing to do so that they assign the funds sent to the correct years and an important document that you can HMRC to refer to if they do not assign correctly. This is particularly important if you are not buying back precisely all of the years offered, as HMRC are likely to incorrectly assign the funds to the wrong years and it will take a long period to unravel.

As with almost all correspondence to HMRC it needs to be done by (old fashioned) post.

It will take several months to get a receipt, and sometimes they will not issue without a prompt. You can check by phone if the years have been added to your account (+441912037010 8am best time)

Attached is a template suggested for you to adapt and use for this purpose.

Note. If the total number of years shown above exceeds 35 years, your maximum contribution level is 35 years. Any amounts contributed beyond 35 years will not increase your pension payout value.

All years offered in this statement are voluntary so you can buy back some, none or all years offered.

Assessing the Risk on the Statement

It states clearly in the first lines of the Statement and again below the table

“Before paying any shortfall, it’s important to find out if your State Pension will increase if you pay voluntary National Insurance contributions (NI Cs). Please call the Future Pension Centre to find out which tax year will count towards your State Pension.”

In the cases we have dealt with we have found that the only circumstance that shortfall years purchased does not increase your State Pension is where buying the years puts you beyond the 35 year maximum gives no additional benefit.

Essentially this is HMRC making sure it is covered, asking you to check with the other arm of government involved, The Pension Service (DWP).

One way to check back is to examine your State Pension Forecast. Earlier in the process we sent you means to get your state pension forecast from the Pension Service (DWP). If you have this, please check the forecast and it should say “you have gaps in your National Insurance record that you may be able to fill and Make count towards your State Pension”.

If you are still Not satisfied, you can Contact the Pension Service as requested.

Contacting the Pension Service to confirm the increase in pension on paying NICs

This is a phrase they use in every statement. It is a moot point to an extent, but it is worth checking out nonetheless if you wish, prior to paying.

It is one arm of Govt : HMRC (UK Revenue) asking you to check with another arm of Govt: Dept of Work and Pensions. Our agency is with the former so we cannot deal with the latter Govt Dept.

The issue is it is very difficult to get through to +441912183600 Suggest you try early am at 0800am and read them your credentials and tell them of the request to call and the years you are able to pay and they will pull up your file and I expect in normal circumstance will confirm.

If you can’t get through to this number suggest you try +441912187777 and they can put you to the right person through a “back door”. They are similarly difficult to reach (maybe a tad easier) but the same early am suggestion applies.

The third option is to use an online contact form https://secure.dwp.gov.uk/contact-the-international-pension-centre/contact-form Suggest you put in your Natl Ins Number, DOB in the enquiry and tell them the years offered by HMRC asking them to confirm this will improve your pension. I would expect it will take them some weeks to revert.  If no response, revert to call them.

Dealing with the Statement and Making Payment

Once you assess what years you wish to buy back you need to make payment in the exact total in £STG within 31 days of the date on the Statement.

Attached are details of the HMRC bank and payment protocols.

De-authorizing Digiads Ltd t/a UK State Pension Abroad as your agent

The UK State Pension Abroad service was expressly set up to assist people to enhance their UK State Pension. We will be closing our business in the coming few months.

Please amend this template letter attached and send it to HMRC NOW, AND IT IS IMPERATIVE TO DO IT ONCE YOUR HAVE YOUR STATEMENT, so that in the future they are dealing with you directly for communications. YOU DEFINITELY DO NOT WANT YOUR ANNUAL PAYMENT REQUEST AND/OR FUTURE CORRESPONDENCE COMING TO US AT “UK STATE PENSION ABROAD” AND RELYING ON US TO FORWARD TO YOU IN THE FUTURE, AS THIS IS NOT OUR ROLE. This requires a letter from you by post to HMRC. PLEASE AMEND THE ATTACHED TEMPLATE AND SEND IN ITS OWN SEPARATE ENVELOPE TO THE ADDRESS ON THE TEMPLATE LETTER

Preparing for Future Year Payments

Future Year Payments (can only be made year by year when requested by HMRC).

Suggest you use the same method of payment used in the shortfall payment, through the Bank using the 18 digit reference (combination of Natl Ins office and name shown in the Bank Details attached).   If you do not get a letter from HMRC by July/August 2026 requesting annual payment for the next full year forward payment (2025/26), I suggest you call them on +441912037010 to clarify (I found 8-830am is the best time).