HMRC apologises as it fixes state pension tool error

The tool was launched a decade ago to help taxpayers calculate how much they would receive when they reach state pension age.

However, an investigation by The Telegraph revealed that the tool may have given up to 800,000 users forecasts that were too high.

This was due to an error that remained unfixed for nine years.

What is the State Pension?

The State Pension is a government-provided payment in the UK that is typically paid every four weeks to people who have reached the State Pension age, which is currently 66.

As the Gov.uk website explains, you can claim the new State Pension when you reach State Pension age if you’re

• a man born on or after April 6, 1951
• a woman born on or after April 6, 1953

The payment is not automatic and instead relies on having at least 10 qualifying years of National Insurance (NI) contributions.

To receive the full new state pension of £230.25 a week, you will need 35 full years of qualifying National Insurance contributions.

HMRC state pension tool error finally fixed

The Telegraph investigation revealed that the tool’s misinformation risked people retiring on lower state pensions than expected.

It also deprived users of the opportunity to increase their weekly payments to tackle the shortfall.

Ministers were reportedly first made aware of the error in the tool in 2017, but it took four years before any fixes were implemented.

There were already some 360,000 incorrect estimates dished out by 2019.

An error was corrected for people reaching state pension age before April 2029.

However, HMRC said that some people due to reach state pension age after that date were still incorrectly being told they would receive the full amount and did not need to make extra payments.

The tool also did not reflect that when someone retires, a deduction is made from their final state pension for any periods when they were contracted out.

Due to this error, up to 800,000 people could have been told incorrectly that they did not need to make any more National Insurance contributions to reach the qualifying number of years.

The Government told The Telegraph it did not know how many people were affected.

HMRC published a message on Monday aimed at users checking their state pension forecast via their Government Gateway account.

It said that a planned system update on February 13 would “improve the accuracy of forecasts” and advised anyone who will reach state pension age after April 2029 to wait until Feb 14 to use the tool.

HMRC apologises as it fixes state pension tool error

A HMRC spokesperson said: “We have made a planned update to our online Check your State Pension tool to ensure customers who reach state pension age after April 2029 will receive a forecast which takes into account the years they were contracted out.

“We’re sorry for the problems that some people have experienced with the tool in the past, but are pleased to confirm this update will ensure customers who reach state pension age after April 2029 will now receive a forecast which takes into account the years they were contracted out.”

HMRC said previously that it would allow those affected by the error to top up their National Insurance contributions by making lump sum payments of up to £907 per missing year.