Pension planning for business owners

The basic state pension


If you have built up enough qualifying years before state pension age, you can get a basic state pension.

What is a qualifying year?

A qualifying year for a basic pension is based on the National Insurance contributions you have paid, have been treated as having paid or have been credited with during a tax year. The tax year runs for the 12 months between 6 April and 5 April of the next year.

The number of qualifying years you will need

The number of qualifying years needed for a basic state pension depends on your gender, your state pension age (SPA) and the date when you reach SPA. Read nidirect's guidance on qualifying years.

If you do not have sufficient qualifying years, your basic state pension may be reduced. 

What is the SPA?

SPA is the earliest age from which you can get your State Pension. The SPA is increasing - see nidirect's guidance on the latest changes to SPA.

How much state pension may I get when I reach SPA?

You can use GOV.UK's online state pension calculator to find out how much state pension you may get. Using information that you provide, this can help you estimate the amount of the basic State Pension you may get and when you can claim it. It will also help you see how you are affected by changes to the state pension.

Pension credit

If you have reached the Pension credit qualifying age you may be entitled to pension credit. Pension Credit is made up of two parts Guarantee Credit and Savings Credit. The Guarantee Credit tops up your income to a guaranteed minimum amount if you have reached the qualifying age.

The Savings Credit is for those who have saved some money towards their retirement such as in a pension, you may be able to get it if you are 65 or over.

The age from which you may get Pension Credit - the qualifying age - is gradually going up.