Thousands of women could be owed compensation worth nearly £8,000 after HM Revenue and Customs (HMRC) discovered an historic error impacting National Insurance and state pensions.
This issue has predominantly affected women who have birth to children in the 1980s and 1990s with many in this group now being entitled to a sizeable payout totalling thousands of pounds.
HMRC is now sending letters to notify those impacted by the error with compensation of up to £7,859 for some women.
Specifically, the historic mishap relates to Home Responsibilities Protection (HRP), which was used to reduce the number of years needed on someone's National Insurance record to qualify for the full state pension.
Mothers could be in line for a nearly £8k windfall
GETTYAs it stands, all Britons need to have 35 years of National Insurance contributions under their belt to become eligible for the full amount provided by the retirement benefit.
However, many women who became stay-at-home mums were unable to pick up these vital contributions due to being out of the workforce for extended period of time.
As such, mothers who received Child Benefit or Income Support between 1978 and 2000 were able to acquire HRP, which filled in the gaps in peoples' records.
In 2010, the system went through an overhaul with HRP being superseded by National Insurance credits.
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Women are impacted by this historic error
GETTYFor thousands of people, their HRP entitlement was not correctly recorded or transferred to their National Insurance record, meaning thousands lose out on income.
Despite this error, the HMRC has acknowledged the issue and is attempting to help fill in any contribution gaps in the National Insurance record of those impacted.
This is particularly concerning for those approaching retirement as it means individuals could receive less from the state pension.
As part of its outreach efforts, HMRC is sending out letters to around 370,000 people affected by the historic injustice.
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HMRC will change its rules within days PASo far, HMRC has undefined just over 5,300 instances of underpayment from January to September 2024, amounting to a total debt of around £42million.
On average, each Briton missing out on National Insurance credits is owed approximately £7,859.
Notably, it is estimated that about 43,000 of the affected individuals have already passed away, but their families can still claim what is due from the Government.
