NI class 2

[specks4]

Hi All

Very annoyed today as just found out im not entitled to job seekers allowence.

Since june i havent been working becuase of children leaving and having no replacment so was told to apply for job seekers while looking for work.
I got a letter today expalining that because i havent paid any NI class 1 contributions im not entitiled to any benefits as class 2 doesnt cover it.

I was very suprised as was told to pay the class 2 when i phoned up to register my buisness.

Apprently class 2 covers NHS and state pension but if you ever needed job seekers or some other benefits the class 2 contributions doesnt cover it.

Im so upset about this as just assumed class 2 would cover everything and was never told otherwise.

Just wanted to make you all aware of this incase your ever not working.

[Chatterbox Childcare]

Why don't you back pay the ni you need to do to get job seekers? Surely you would of been paying the correct stamp before you stopped working?

[specks4]

I have been paying it but because it isnt class 1, class 2 doesnt cover being entitled to benefits. I just feel what has the point of me paying class 2.

[Chatterbox Childcare]

You may be able to top up the class 2 to class 1

Class 2 is for small earners so you would be employed or self employed anyway and not looking for work

[specks4]

I would have to top it up for the year 2010- 2011 as that's what they looked at, but I would end up paying quite a bit to top up and wouldn't be worth it, the fact I haven't got any money so not in situation where I could top it up anyway. Just think once we register our business we should be informed of this and given the opportunity to pay any extra to qualify for benefits if needed, or told paying class 2 doesn't cover us for benefits.

[MrAnchovy]

There's a bit of confusion here.

Class 2 contributions are paid by all self employed people (unless they have very low earnings and opt out, which is often a bad idea). They entitle you to some benefits - mainly credit towards the basic state pension and maternity allowance - but not contributions based job seekers allowance. One reason for this is that anyone who didn't have a job and couldn't get JSA could register as self employed, pay a few weeks contributions and then say they were no longer self employed and claim JSA.

Class 1 contributions are paid by all employed people and their employers (unless they have very low earnings). They are much higher than Class 2 contributions and entitle you to more benefits. You cannot voluntarily pay or top up Class 1 contributions, you can only pay them by being employed.

Class 3 contributions are voluntary contributions you can pay to buy additional years of credit towards the basic state pension; they do not qualify you for any other benefits. As they are higher than Class 2 contributions and entitle you to fewer benefits there is no point paying them if you are self employed, they are intended for people who do not work or have low earnings.

[lucyD]

How about finding out if you can income support?