Thursday 19 November 2015

Changes to State pension and NI contributions

 £5 billion tax raid

A hidden £5 billion pound tax raid will hit the pay packets of 5 million public sector workers next April.
Workers who earn £25,000 – around the average salary – could have to pay an extra £267.80 because of a rise in National Insurance contributions.
The increase is a little known consequence of the new state pension from April 2016.
Those affected are currently contracted out of the state second pension – a top up scheme that allows workers to earn extra retirement income. As they opted out the Treasury reduced NI contributions. The state second pension is to be scrapped from April so anyone contracted out will have to pay higher NI contributions.
Many workers didn’t know they were paying lower National Insurance but anyone contracted out will pay an extra 1.6p National Insurance for every £1 they earn.

When the new state pension was introduced workers were told that anyone who had 35 years of NI contributions would qualify for the full new pension. This is not the case and one in three workers will get the £151.25 a week from next April.

To find out more go to

Find out how much State Pension you can expect by getting a State Pension statement. Go to
Back to Top