A significant error in state pension calculations may entitle you to reclaim substantial sums from the Department for Work and Pensions (DWP). The amount of state pension you receive later in life hinges on your National Insurance record, with most people needing 35 years of contributions for the full new state pension. Individuals out of work may qualify for National Insurance credits to bridge any gaps in their record.
Concerns have arisen that many individuals missed out on Home Responsibilities Protection (HRP), an old form of National Insurance credits that reduced the required qualifying years for the state pension. HRP, which was replaced by National Insurance credits in 2010, was supposed to be automatically applied to those claiming Child Benefit. However, due to missing National Insurance numbers on Child Benefit forms submitted before 2000, HRP was not correctly added to records, affecting those on Income Support caring for a disabled or ill person.
If your National Insurance record lacks the appropriate HRP credits, you may have been underpaid the state pension and are owed money. Those who took time off work to care for a child, family member with a disability, or long-term illness between 1978 and 2010 may be impacted, particularly women in their 60s or 70s. Recent data from HMRC revealed that 370,000 women were contacted about potential underpayments, leading to 5,344 identified cases totaling around £42 million in arrears.
The payout amount varies depending on the extent and duration of underpayment. The average reimbursement per person, according to the DWP, stands at £7,859. Some individuals have received tens of thousands in back payments, such as one individual who reclaimed over £31,000.
If you suspect you are not receiving the full state pension, it is advisable to check your state pension forecast or statement. The new state pension is valued at £230.25 weekly, while the old basic state pension amounts to £176.45 per week. If gaps are apparent, reviewing your National Insurance record through the Government’s online checker tool is recommended.
To claim missing HRP, utilize the online service on GOV.UK or complete and mail this form to HMRC. While an estimated 43,000 eligible individuals have passed away, their families can still claim on their behalf.