Contracting out in pension schemes abolished

25 January 2012
Contracting out in pension schemes abolished

From 6 April 2012, individuals who have “contracted out” of contributing to additional State Pension will be automatically brought back into contributing to the additional State Pension.

The government has decided to do this given the difficulties individuals have judging whether they would be better off contributing to additional State Pension or contracting out.

Affected individuals will no longer receive rebates on their National Insurance contributions and instead will begin to build up entitlement to the additional State Pension.

For comprehensive Q&As, see the Directgov website.

Source: Sandy Adirondack

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