DWP State Pension could be boosted by people in 'few simple clicks'

A new service could help people increase their state pension with "a few simple clicks".

This forecasting platform from HM Revenue & Customs (HMRC) and the Department for Work and Pensions (DWP), permits those under state pension age to inspect gaps in their national insurance (NI) record and provide voluntary contributions to fill the gaps, assuming it benefits them. The service will highlight the potential rise in their state pension, along with the specific details about the voluntary NI they need to fork out to achieve this boost.

Users can easily select which years they want to pay for and then safeguard their payment via the service. They will receive confirmation that their payment has reached its destination and their NI record is going under an update.

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Generally, individuals can pay voluntary contributions for the previous six tax years, with the deadline falling on April 5 each year. However, last year, due to new state pension transitional setups, the Government stretched the time limit for paying voluntary NI contributions up until April 5, 2025.

Those who are eligible have till then to straighten out discrepancies in their NI records from April 6, 2006, and April 5, 2018. But, from April 6, 2025, people will only be able to offer voluntary payments for the past six tax years, adhering to the usual time limits.

Pensions minister Paul Maynard said: "The state pension is the foundation of income in retirement, which is why we have introduced this new online tool to help simplify boosting it for those who are able to. I would encourage everyone to check their state pension forecast and to take a look at how they could improve their state pension award with only a few simple clicks."

Financial Secretary to the Treasury Nigel Huddleston added: "Having peace of mind when planning for retirement is crucial to ensure people can enjoy later life."

While paying voluntary contributions doesn't always mean an increased state pension, the new service aims to assist individuals in assessing whether making voluntary NI payments could leave them better off when they retire For some, national insurance credits might be a more suitable option than voluntary contributions.

To access the new digital service, users will need to log in using their personal tax account login details. Those without an HMRC online account can sign up at gov.uk.

However, the service isn't available to those already receiving their state pension, self-employed individuals, or those living outside the UK with gaps in their NI record due to working abroad. Former pensions minister Sir Steve Webb, now a partner at LCP (Lane Clark & Peacock), welcomed the update.

He said: "It is very good news if people will be able to top up their national insurance record online. People have had to struggle with two different phone lines one to check with DWP which years they can top up and then another to HMRC to get a reference number to make a payment.

"It must be a step in the right direction to be able to do all of this without hanging on a telephone. However, simply getting your NI record updated by HMRC is only half of the story.

"It then needs DWP to reassess your state pension entitlement based on your improved contribution record. There are already too many cases where people wait months or longer to get their pension figure revised.

"It is vital that the Government puts in place new capacity at DWP to process all of these changes; otherwise they will simply have created a new bottleneck in the system."

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