Forum

Tax and NI Contributions

I know benefits and pensions are taxed but is NI still paid when no longer working?

Jan x

Basically,

NO, NI is only paid if you are working as also your employer pays in.

If you are on beneits - the DWP pays your minimum contribution, because your not working.

But, I think, it can effect your state pension because of your NI Contributions. - You may recieve a basic state pension at 60/65 ???

But you will have to confirm this properly. Andy

Andy is basically correct. You pay NI on any employment income earned up to your state pension age, which after recent changes could be anything up to 67 depending on your age now. You don’t pay on benefit income and you are credited with contributions to count towards your state pension if you are in receipt of a valid benefit. J.

Thank you Andy and jk have a cyber pint on me

Another question, if your pension and benefits bring you into the tax bracket how is that tax paid?

Jan x

Your benefit goes toward your Free Tax Allowance and then you are given a tax code for your pension and other declared income.

Which is deducted by your pension provider. and paid to HMRC

Andy

Thank you Andy

Jan x