Living Overseas and NI Contributions

Discussion in 'Jobs (Discussion)' started by bullshit, Feb 3, 2007.

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  1. Any ex-pat squaddies out there who still pay national insurarance? If so - why?!

    I am getting mixed opinion on if I should, or should not keep paying NI if living overseas after de-mob.

    Any advice is most welcome.
  2. For the past 8+ years, Nope!

  3. Why, what's the point?

    You can make voluntary contributions, yes.

    Why would you want to do that?

    So you can receive a higher pension at the end?

    I'm semi-retired at 53. I don't pay NIC because;
    a.) I've got sufficient to survive on and that will always continue,
    b.) I'm fcuked if I'm going to pay for something I'm never going to need the benefit of, and
    c.) the system is set up for abuse and I won't support it.
  4. You will, by now, have made x payments towards your old age pension. For the maximum pension, you will need to make y payments. Go to the pensions site, fill in the form and then sit down and work it out. If the internal rate of return is higher than that which you can get from a building society, then start paying. If you are up to your eyeballs in debt, then don't. I am reasonably well off, but that £80+ per week will keep me warm for a few days each week, at least. Plus, not claiming it would make Gordon happy and I can't do that.....

  5. True, true. Yes that would always make good sense for one and all to do the sums before committing.

    I did the calculation when I left the kate and mobilised the family overseas on discharge so I haven't paid a penny for fifteen years.

    I'd also like to add that buying a bottle of One Barrel every week gives me more enjoyment than paying it to a foreign (UK) government :)
  6. I do remember something about the Government freezing pension payments to ex-pats in Australia, New Zealand, Canada and South Africa at what the current pension paid out in 2002 and will no longer be indexed linked for people living in those countries. If that is the case then it is hardly worth contributing to a pension like that as it will be worthless by the time you retire. There was something about it being taken to the European court of human rights and was overturned. I know that if you make contributions up to five years after your last payment , your pension is not effected, after that you will not get the maximum payable. Seems like a private pension or playing the stock market yourself might well serve you better than anything else, even property might be a better nest egg than the vagaries of the pension system.
  7. My sentiments entirely. Enjoy it while it's in your hand or at least put it into something where you know it will make an effective return. As you say, even property where you will always have the rent to supplement your income.

    Also, I understand the countries you mentioned have a reciprocal agreement with UK, for tax and pension purposes.
  8. I have the same dilemma as yourself. I have paid in 22, i think the max is going to be reduced to 30 years, which I find goes well against the Pension headlines. My wife who is a Canadian has paid in less. I think we are better off, starting up something new in the country we will make home.

    Slightly off thread but does any expat out there have any good gen about pensions and lump sums, ie is the monthly index linked when you are receiving it overseas, and secondly for the lump sum did any expats get jiffed with foreign tax.
  9. Mate, I would suggest starting a new thread with that as the topic.

    After clarifying your question because I'd like to help you if I could but I don't really understand what you're chatting about.
  10. I moved abroad 1 month after discharge. I initially paid NI cont at the voluntary rate (about £30 per month) but later switched to the self employed rate (at the suggestion of HM R & T) of £8 per month. I received a letter last year advising me to stop paying as I have completed 30 years of contributions & am therefore eligable for a full state pension.

    I wrote to HMR&T in Jan to clarify the situation & await their answer.

  11. Surely if you are ordinarily resident overseas, you are therefore not subject to UK tax? Why are you paying 50 quid a month tax on your pension?
  12. There are multi-national agreements in place that mean you get taxed at source but do not get taxed again by your adopted country, unless you are in one of those countries that does not subscribe to the agreement, then it is up to you and your tax declaration! Sorry, don't know what the agreement is called but I looked into this when I left over 12 years ago. Regardless of where you go though, HMG will take their pound of flesh!
  13. Thats called the Double Taxation Agreement and currently the list of countries that subscribe is over 30 (See link section 9.16 for a complete list.

    Residence, ordinary residence and domicile - more detailed definitions from HMRC

    So in summary you will pay tax on your pension but you also are eligible for your tax free allowance, providing it is your only source of income while living overseas. If you do want to protect your NI contribution status you can back date payments up until 5 years of not being "ordinarily resident". I am not sure what happens past that point yet but I need to find this out as I have now close to that point,

    Hope that helps :plotting:
  14. Got out after 12 and moved straight here to the US 2 years ago - Not been paying it. Not sure whether to pay the catch up or not; probably not in all honesty, if the worth of the state pension is to be believed in another 30 years time when I'm set to retire. Plus, I'm paying into the spam system here - 30 years of that is about the same as what its worth in the UK.
  15. RE: fingers 1661; you said that you had paid 30 yrs and that qualified you. I just spoke to the Pension Office and they said it was currently 44 years of payments but MAY come down to 30. Suggest you check!

    For ex-pats out there, you can ring the Pension Overseas Dept on (44) 845 9154811. they are easy to talk to and very co-operative.

    As to if I will keep paying NI? Not sure! Currently it is GBP 7.55 PW for Class 3 contributions which adds up to quite a p*ss up at the end of the year!

    As to double tax, you can ring the tax office on (44) 845 3003949 and ask to be put through to somebody who deals with double taxation agreements. I did this and that found a chapter in the deal the UK has with Denmark (where I will settle) and gave me all of the details on how I was not eligible for Danish Tax on my Service Pension - very helpful