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National Insurance contributions?

C

I'm in the 2nd year of my NERC funded PhD and it's just occurred to me that I haven't paid any national insurance contributions since starting. I little background, I graduated in 2000 after a 4 year degree, then worked (paying NI) for 10 years, starting my PhD in 2010. What are the implications of not paying NI for the 3-4 years of my PhD?

Thanks.

S

PhD Stipend is not taxable so you don't pay tax or NI on it

http://www.postgraduateforum.com/threadViewer.aspx?TID=4406

hope that helps.

C

======= Date Modified 19 Apr 2011 14:42:15 =======
Indeed, I know I don't have to pay any NI. I'm wondering about the implications of not paying. Doesn't the state pension and/or job seekers allowance depend in part on NI contributions?

D

I do know it can have an impact on state pension. Basically, you have to work or pay N.I contributions for so many years (do check but I think in the region of 30+ years) in order to get a state pension.

B

You can get a state pension with NI credits for fewer years, but your pension will be reduced.

If you are in your early 20s I would not worry too much about missing some NI years. But if you are an older PhD student I would recommend considering paying voluntary contributions to make up the shortfall. You can pay these later when you are earning. You are allowed to pay voluntary contributions for so many years back in time.

B

Oh and re benefits, I fell into a benefits trap because of being (originally, many years ago) a full-time PhD student who then fell seriously ill. I couldn't claim incapacity benefit (the obvious benefit) because I had no NI credits from my PhD years. Even voluntary contributions wouldn't have been enough. Only NI credits from employment counted. So I was benefit-less. And because my husband was still a PhD student we were ineligible for lots of other benefits. Mucho poverty ensued until hubby passed his PhD viva and started working.

D

BilboBaggins,

Talk about getting kicked when you're down! I'm sorry you had to go through that...

B

Thanks Delta. I wrote to MPs and complained a lot at the time. Got some of the frustration out of my system! The rules have improved a bit since. I like to think it might have something to do with my campaigning. Now the benefits allow people to be full-time students for longer and still get such benefits. When I was first ill they only supported students under 21. Fat lot of use for someone who had gone on to study a PhD! There are still benefit traps. But not as bad.

D

I think you're incredibly gutsy having to take the news about your illness and then having to endure all that! I'm glad you fought on and hopefully this has helped others. I'm actually horrified at how you were treated.

S

Hi,

I am a PhD student and I also have a sole-trader where I pay NI contributions.
I know that I need 30 years to get the basic pension, but what happens if I pay for 5 years only.
Will I get 1/6 of the basic pension from the UK in the future, when I move to my country of origin?
How it works?
Carl

B

For questions about NI contributions and pension eligibility etc. have a look at http://www.hmrc.gov.uk/ni/index.htm

P

The implications are that when (sorry if) you find yourself unemployed after finishing your PhD you may not be entitled to any benefits.
I recently went to sign on and was told my claim could be household income based or contribution based. As my boyfriend is deemed to have a good salary (not taking into account he has to pay maintenance for his son and could not afford to pay all the household bills) I wasn't entitled to anything on that count. However, if I had paid NI contributiond for the past two tax years then I would have been entitled. So I would think ahead if I were you and if you can afford to make contributions then I would do it.

B

Be careful though, if making voluntary contributions they don't always make you eligible for benefits. This includes the contribution element of JSA, and Incapacity Benefit which was the hole I fell through.

See http://www.hmrc.gov.uk/ni/intro/benefits.htm

For some benefits - like JSA contributions element - only NI credits from employment count.

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