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Pensions and tax

Do I pay NI on my pension?

National Insurance contributions are levied on income from employment or self-employment

Pensions and National Insurance

You don’t pay National Insurance contributions (NICs) on any payments that you receive from a pension scheme including an annuity, but you may be liable to income tax on these payments.

If you’re aged less than your State Pension age, you are liable to pay National Insurance contributions on your income from employment or self-employment (provided that you earn above the minimum amount on which NICs are charged).

Once you reach State Pension Age, you stop paying NICs (although, if you are self-employed, you’re still assessed for Class 4 NICs in the tax year in which you reach State Pension Age). To stop, you can show your employer proof of age (such as a birth certificate or a passport), or, if you don’t want to show these, you can ask HMRC to send your employer a letter.

If you’ve paid NICs when you are no longer liable to these, you can claim back the overpaid amounts from HMRC.

You can find more details here on the Government website.

Frequently asked...

Where can I find out more?

If you need more information, please contact us. A pension specialist from our team will be happy to help with whatever pensions-related question you have. Our help is always free.

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