NIM25011 | Class 3 NICs: Restrictions on the right to pay: precluded Class 3 NICs: qualification to circumstances in NIM25007 and NIM25008: contribution conditions

Regulation 49(2) Social Security (Contributions) Regulations 2001

Paragraph 4 Part 1 Schedule 3 Social Security Contributions and Benefits Act 1992

NIM25007, and NIM25008 set out the circumstances in which a person is precluded from paying Class 3 NICs.

For tax years from 6 April 2017 onwards Class 3 NICs only count towards entitlement to new State Pension. But a person is still entitled to pay Class 3 NICs for earlier tax years in any of those circumstances if it would enable them to satisfy the contribution conditions for the following benefits:

• Basic State Pension (where the individual reaches State Pension age before 6 April 2010)

• Widowed mother’s allowance

• Widowed parent’s allowance

• Bereavement allowance

• Widow’s pension

• Bereavement payment

• Widow’s payment

the first contribution condition for the above benefits is that;

• For years before 6 April 1975 the person must have paid 50 flat-rate contributions at any time

• for tax year 1975 to 1976 onwards, the person must have actually paid Class 1, Class 2 or Class 3 NICs in any one tax year; and

  • in respect of the 1975 to 1978 tax years, the earnings factor (“EF”) derived from such NICs is at least 50 times the lower earnings limit (“LEL”); or

  • for tax year 1978 to 1979 and subsequent tax years, the EF derived from such NICs is at least 52 times the LEL

For basic State Pension where the individual reaches State Pension age between 6 April 2010 and 5 April 2016 the above conditions apply except that there is no requirement for contributions to actually be paid in any one tax year.

Entitlement to basic State Pension can be achieved by credited contributions or credited earnings alone.