HMRC Announces £5,000 Payment for 210,000 Seniors – Eligibility and Payment Dates

The HM Revenue and Customs (HMRC) has recently launched a significant initiative to address underpayments in state pensions, specifically targeting around 210,000 senior women. These payments, estimated to be around £5,000 per individual, are being issued to those who were affected by missing National Insurance (NI) Credits and Home Responsibilities Protection (HRP) between 1978 and 2000. This article outlines the eligibility criteria, payment dates, and latest updates on this important initiative.

HMRC Payment

The underpayment issue stems from errors in the administration of NI records, particularly for women who claimed child benefits between 1978 and 2000. During this period, many women did not receive the correct HRP credits on their NI records, which are crucial for calculating state pension entitlements. As a result, these women have been underpaid on their state pensions for years.

To rectify this, HMRC, in collaboration with the Department for Work and Pensions (DWP), has started contacting affected individuals to inform them of their potential entitlement to back payments. The total amount owed across all affected individuals is estimated to be around £1.3 billion, with each senior potentially receiving an average of £5,000.

Eligibility

Eligibility for the £5,000 HMRC payment hinges on several factors. Here’s a breakdown of who qualifies:

1. Child Benefits Claimed Between 1978 and 2000: The payment is specifically for women who claimed child benefits during this period but were not properly credited with HRP on their NI records.
2. NI Record Status: The claimant’s NI record must show that they were missing HRP credits during the relevant years. This primarily affects those who reached state pension age after April 5, 2010, as their HRP credits should be displayed as full years on their records.
3. Personal Circumstances:
   • The child benefits must have been claimed in the woman’s name, not her partner’s.
   • The claimant’s child should have been under 16 during the period in question.
   • The claimant must not have paid the reduced stamp (a lower rate of NI contributions for married women).
4. Exclusions: Those who claimed child benefits after 2000 are generally unaffected, as it became mandatory to provide an NI number for claims after May 2000, ensuring HRP credits were accurately recorded.

Payment Dates

As of now, HMRC has begun notifying the affected individuals, but specific payment dates have not yet been set. The process of identifying and rectifying these errors is expected to take up to 18 months, during which time eligible seniors will be contacted and informed about their payments.

The payments will be processed in stages, with seniors in their 60s and 70s receiving letters first. The average payment is expected to be £5,000, although deceased individuals’ estates may receive around £3,000.

Latest Updates

HMRC and DWP have initiated a correction campaign to address the unrecorded HRP credits issue, which resulted in the underpayment of state pensions. Affected pensioners are receiving notifications via brown envelopes, informing them of potential underpayments and the availability of paybacks.

The correction process involves updating NI records to include all HRP credits from 1978 to 2010. This rectification will ensure that the rightful pensioners receive the payments they are owed. HMRC has committed to ensuring that these errors are resolved efficiently and has taken steps to prevent such issues from recurring in the future.

How to Check

If you believe you may be affected by this underpayment issue, there are a few steps you can take:

1. Review Your State Pension and NI Records: Check your records to see if all HRP credits are correctly reflected. For those who reached state pension age after April 5, 2010, each credit year should appear as a complete year on your record.
2. Use the Online Checker: The UK government provides an online tool to help individuals check if they are missing HRP credits.
3. Contact the NI Helpline: If you need further assistance, you can contact the National Insurance Helpline to confirm whether your HRP credits are recorded correctly.
4. Submit a Claim for Missing Credits: If you find that your credits are missing, you can submit a claim using the CF411 Form. This form is available on the UK government’s official website.

The £5,000 HMRC payment is a crucial step in addressing a long-standing issue that has affected the retirement security of thousands of women. By rectifying the errors in NI records, HMRC and DWP are ensuring that these seniors receive the full state pension to which they are entitled.

While the process may take time, the payments represent a significant financial boost for many, providing much-needed relief. If you think you might be eligible, it’s important to review your records and stay informed about the latest updates to ensure you receive any payments owed to you.

FAQs