Client has dropped salary to 10K ish.
He asked about the effect on state pension or whatever NIC contributes towards. He is fine with saving thousands each and every year - ie this outweighs the potential drop in state pension. But does anyone know how much he would lose out on? (as I type it seem a piece of string question).
Or is the only answer a state pension forecast now and in 18 years time with two different salary levels?
Thank you.
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Zero
Assuming that your client:
is not in a contracted out employment (in essence contracting out no longer applies for those employees not in defined benefit schemes)continues to be paid above the lower earnings limit in at least one employment (currently £112 per week or £5,824 per annum if an annual earnings period applies, e.g. they are a directors)was born on or after 6 April 1951
then the answer is zero - the drop in salary will have no impact on their state pension.
Of course there may be no such thing as a state pension in 18 years time - after all who thought that our beloved governments would do us out of years of pension by pushing the pension age forward from 60/65.