HMRC rule change could boost your state pension by thousands - but you must act now

HMRC has updated its regulations, placing a deadline of April 5, 2025, for state pensioners to enhance their state pension entitlements. Individuals now have less than five months to take action that could significantly increase their DWP state pension benefits.

This final extension grants people extra time to review and act on their pension strategies. Eligibility for these voluntary National Insurance contributions extends to men born after April 6, 1951, and women born post-April 6, 1953.

Some may qualify for NI credits instead of making payments, therefore it's vital for them to check and decide what's most beneficial for their situation, based on a Birmingham Live report. HMRC's data revealed that over half (51 percent) of users amended a single year of their NI record online, with an average transaction cost of £1,193.

Pensions Minister Emma Reynolds encourages individuals, emphasizing: "We want pensioners of today and tomorrow to enjoy the dignity and support they deserve in retirement. That's why I urge everyone to check if they could benefit by filling gaps before the deadline passes. Using our online tool means only a few clicks could make a huge difference to your future."

Alice Haine, a personal finance analyst at Bestinvest by Evelyn Partners, explained: "People typically need at least 10 qualifying years of NI (National Insurance) contributions to receive any state pension at all and at least 35 years to receive the full new state pension - though they don't need to be consecutive years.", reports Cambridgeshire Live.

She added: "Plugging gaps can be quite an expensive process, so it is important to assess whether you actually need to buy back any missing years. This will depend on how many more years you plan to work, and whether you are eligible for NI tax credits, which fill the gaps, such as those who have been sick, were unemployed or took time out to raise a family or care for elderly relations."

She also mentioned: "Plugging gaps in your record is relatively straightforward since the Government rolled out its new NI payments services in April this year - a State Pension forecast tool that has been checked by 3.7m since its launch."