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The Government has announced the possibility for the retrospective payment of national insurance contributions (NIC). An individual can pay five years national insurance contributions in the missing contributions period. These contribution are paid at the present rate of €28.47 weekly which amounts to €7,402.20 if the full five years are paid in arrears.

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These are the conditions for this retrospective payment of national insurance contributions:

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• The applicant should be aged between 59 and 65 years – important that s/he has not attained age 65;

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• The applicant should be currently in employment however pensions can also apply, both on invalidity pension and retirement pension;

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• The applicant should be resident in Malta in the period s/he is going to pay the missing contributions.

 

This payment of national insurance contributions may reflect a difference in pension rate. For this reason two tentative assessments are carried out to establish the difference between:

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• the current contribution average and the resultant pension rate, and

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• the revised contribution average and the projected pension rate.

 

It is the applicant’s responsibility to assess the difference. We will help the applicants to check whether the retrospective payment of National Insurance Contributions is practicable or not. We will help you determine whether it is worth paying the bill.

 

Those who may benefit more than others are those national insurance payers who have missing contributions in the last 10 years prior to their retirement year given that each contribution is equivalent to 2.5 contributions.

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How we can assist

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We will help applicants establish the feasibility of the retrospective payment of pending NIC, together with the negotiation of a settlement plan to suit individual circumstances.

 

If you would like to know more about this development and how it might affect your business, or indeed to discuss any other tax or NIC matter, please get in touch with us.

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July 2015