The HMRC Pension Underpayment Correction Initiative is an important measure by HM Revenue and Customs (HMRC) to address a significant issue regarding underpaid pensions, affecting around 210,000 individuals, primarily women in their 60s and 70s. This problem arose due to administrative errors made between 1978 and 2000, particularly when individuals who claimed Child Benefit did not provide their National Insurance numbers. As a result, many of them were not given the full pension entitlement they were due.
As part of the HMRC correction effort, notifications have been sent in distinct brown envelopes to individuals potentially impacted by this error. These letters explain the steps needed to claim any missing pension payments. The initiative aims to correct National Insurance records to properly reflect Home Responsibilities Protection (HRP) credits, with an average refund of about £5,000 per affected individual. This move demonstrates HMRC’s commitment to ensuring pensioners receive their rightful state pension benefits.
Table of Contents
- Background and Cause of the HMRC Pension Underpayments
- Current Efforts and Remediation Steps
- How to Check If You Have Been Underpaid
- DWP £299 Cost of Living Payment Date
- DWP Festival Relief: Will the £299 Cost of Living Payment Be Repeated in 2024?
Background and Cause of the HMRC Pension Underpayments
The pension underpayment issue targeted by the HMRC Pension Correction Initiative stems from issues with the Home Responsibilities Protection (HRP) scheme. HRP was introduced to help individuals, particularly women who took time off work to care for children or dependents, continue earning credits toward their state pension. These credits were crucial for qualifying for a full state pension once reaching retirement age.
From 1978 to 2000, however, many people who received Child Benefit did not provide their National Insurance numbers on the claim forms, leading to an oversight. As a result, their HRP credits were not properly added to their National Insurance records. This error meant that when these individuals reached pension age, their records did not reflect all the credits they had earned, resulting in lower pension payments than they were entitled to.
This issue, which has affected around 210,000 individuals—mostly women who were stay-at-home mothers or caregivers during these years—went unaddressed for decades.
Current Efforts and Remediation Steps
In response to this long-standing problem, HMRC has launched a correction campaign. As part of this initiative, individuals affected by the pension underpayments are receiving notifications in brown envelopes, informing them of the issue and the process for claiming back the money they are owed.
The Department for Work and Pensions (DWP) has started processing these claims in early 2024, after HMRC mailed the initial notices in late 2023. This process involves reviewing National Insurance records and adding the missing HRP credits for the affected period. The goal is to ensure that pensioners receive the correct amount of pension they are entitled to, based on their accurate records.
How to Check If You Have Been Underpaid
If you believe you might have been affected by the HRP underpayment issue, here are some steps you can take to verify and potentially claim what you are owed:
- Review Your Records: Check your State Pension and National Insurance records. For those who reached pension age after April 5, 2010, your record should show the full years of HRP or credits. If not, it might indicate missing credits.
- Use the Online Checker Tool: The UK government provides an online tool on the official Gov.uk website to help you check whether you might be eligible for missing HRP credits.
- Contact the National Insurance Helpline: If you reached pension age on or before April 5, 2010, HRP was recorded differently. You can contact the National Insurance helpline to confirm if HRP credits are on your record.
- Fill Out the CF411 Form: If you discover that you are missing HRP credits, you will need to fill out the CF411 Form to claim any missing credits for the period up until March 2010.
By taking these steps, you can ensure your pension records are accurate and claim any back payments you are owed.
