A new online service to top up state pensions is due to be introduced by spring

State pension top-ups: HMRC takes additional contributions, then the DWP recalculates the projections or payments under the current system

A new online service for purchasing state pension top-ups will be launched in the spring after a flood of complaints that the current system was confusing and took too long to process payments.

The website, currently being developed and tested by the Government, will allow people to check locally which years are best for them to top up and purchase, but will still be able to call and pay offline if they prefer.

Buying top-ups can provide a generous boost to your retirement income if you buy the right years on your register, but the scheme is run jointly by the Department for Work and Pensions and HMRC and currently includes servicing of both.

It was overwhelmed earlier this year when a rush of buyers jammed phone lines ahead of a tight deadline – ultimately forcing the government to extend the deadline twice. This led to a backlog that is still ongoing, according to reader emails received by This is Money.

During the process, people have to figure out which years they want to buy, which isn’t easy due to rule changes and makes filling some gaps pointless.

The government advises people to check with the DWP and obtain a reference number from HMRC before purchasing.

HMRC then takes additional contributions and then the DWP recalculates the state pension projections or payments.

But some people have paid large amounts and waited months for processing, not knowing whether they’ll just sit in the queue or get lost because they don’t receive a receipt or confirmation of the purchase.

They claim government officials provided them no assistance in trying to trace their cash.

The government says the vast majority of top-ups are processed within days, although complex cases requiring specialized caseworkers can take longer to resolve.

> “My £11,500 state pension top-up balance had disappeared for months…”

A spokesman said: “We are building a new online service to enable people to see whether paying voluntary national insurance contributions would increase their state pension and then make payments.”

“The new service is currently being developed and tested to ensure it is easy to use and provides accurate information in a straightforward manner. “We expect it to be ready this financial year.”

The government says most customers should be able to take full advantage of a new online service that HMRC and DWP plan to roll out by the end of the financial year next April.

Once testing is successfully completed, new guidance will be issued on who can use the new digital service and how to do so.

The government adds that the website will contain information to help customers decide in which years they can make up their deficits, based on the available gap years that are most favorable or beneficial. They can then pay their top-ups to their statutory pension online if they wish.

However, it says customers will still be able to contact both DWP and HMRC using existing methods to obtain further information about their national insurance records and state pension forecast and to pay any voluntary contributions.

Former pensions minister Steve Webb said: “One of the big frustrations in the current process is having to battle phone lines not once but twice to top up your state pension.”

“A streamlined online process would benefit both those who enjoy doing things online and those who still want to speak to someone, as it should reduce the number of phone calls.”

Webb, who is now a partner at consultancy LCP and a pensions columnist for This is Money, added: “While a thorough review and audit is right and proper, it would be good to launch this service as quickly as possible.”