Should I pay Class 2 National Insurance if I leave the UK?
If you continue to pay UK National Insurance Contributions (NICs) when you are working abroad, you will still be entitled to your full State Pension and the other allowances and benefits it pays for.
Whether or not you are allowed to continue NIC payments depend on which country you are now working in, your employment status and the length of time you remain there.
We need to look at the type of economic agreement between the UK and the country you are working in. This information, combined with how you are employed provides the answer to whether or not you should pay National Insurance Contributions in your particular situation.
Class 2 Voluntary National Insurance Contributions
In most cases if you are abroad you can make voluntary Class 2 National Insurance payments to protect your UK State Pension and entitlement to other benefits and allowances.
Class 2 voluntary contributions criteria
Not everyone who leaves the UK is entitled to make voluntary class 2 national insurance contributions.
To be eligible:
- You must have worked in the UK immediately before leaving
And - You have previously lived in the UK for 3 years in a row
Or - Paid 3 years’ National Insurance
Can I just make voluntary contributions so my State Pension is fully accounted for?
Yes, you can make voluntary NICs in many situations. You need leaflet NI38 for the eligibility criteria, which includes HMRC application Form CF83.
It is important to remember that this leaves you without health insurance in the country that you are working in if you make voluntary UK NICs.
Countries that are members of the EEA (European Economic Area) or the EU, and Switzerland
These countries have agreed that all workers pay the social security of their employer’s host country. This means that you do not pay UK NICs, but the equivalent in the country where you now work. The upside of this is that you can access some benefits in the country you now live in and may be entitled to medical treatment at a reduced price, or for free. The downside is that you will accumulate a gap in your UK NICs.
This is the rule in most cases, but of course there are exceptions. You might be able to only pay UK NICs, and not social security in the other country, if you are:
- Working in two or more EEA countries, this includes Britain, it depends where you live. (Form CA8421i)
- Self-employed in the UK and are only working abroad for a maximum of two years. (Either Form CA3837, or Form CA3822 if you’re a limited company)
- Working for a UK employer that has sent you on secondment to another EEA country for no more than two years. (Form CA3822)
Countries outside the EEA with Reciprocal Agreements or Double Contribution Convention Agreements
The UK has Reciprocal or Double Contribution Convention Agreements with some countries outside the EEA. These are sometimes referred to as bilateral Social Security agreements and are negotiated with each individual country rather than a group, like the EEA. They usually state that you pay social security in the country in which you are working. So, if you are going from the UK to work in one of these countries, you would not be paying your UK NICS as well.
Currently the UK has bilateral Social Security agreements with the following countries: Barbados, Bermuda, Bosnia-Herzegovina, Canada, Chile, Croatia, Guernsey, Israel, Jamaica, Japan, Jersey, the Former Yugoslav Republic of Macedonia, Mauritius, Montenegro, New Zealand, Philippines, Republic of Korea, Serbia, Turkey, and USA.
Exceptions to the rule
If you are self employed in the UK and are only spending a temporary amount of time working abroad then you might be able to continue with UK NICs payments and not have to pay the equivalent in your host country. (Form CA9107).
Similarly to the EEA agreements, if you are sent to work temporarily in one of these countries by you British employer then you might be able to carry on paying UK NICs instead of the other country’s social security equivalent. (Form CA9107).
It is wise to research this thoroughly to make sure you understand the impact of this on your ability to access necessary benefits and healthcare while you are working abroad.
All other countries
If your employer is in any other country (not EEA, with a bilateral Social Security agreement, or Switzerland), then you are allowed to continue with your UK NICs for up to 52 weeks working abroad; as long as you meet these three criteria:
- You have just been living in the UK
- You are ‘ordinarily resident’ in Britain
- Your employer in the other country has a British business location
As a self employed person you can continue your Class 2 National Insurance, but you do not have to in these circumstances. There are eligibility criteria to meet.
Do these rules apply when I work for the UK government?
No, if you are working abroad in a UK government role then you simply continue to pay UK NICs. This includes serving members of the Armed Forces, civil servants, diplomats, embassy staff, consular appointments and all their staff.
UK tax rebate services
When you have left the UK it’s common to be entitled to a refund of income tax after you have left. The reasons for overpaying tax are varied and depend on your particular set of circumstances. You can learn more about what tax you could be owed back in our leaving UK tax refund guide and in our UK expat tax and non resident tax guides (for people paying tax in the UK and whilst living outside the UK).
